XML 24 R11.htm IDEA: XBRL DOCUMENT
v3.3.1.900

Rationalizations (Notes) | 12 Months Ended
--- | ---
Dec. 31, 2015
Restructuring and Related Activities [Abstract] |
Rationalizations | Rationalizations Throughout 2014 and 2015 the Company undertook rationalization plans in order to streamline our organization and lower our production costs. The following tables summarize the total rationalization and related charges incurred during 2014 and 2015 followed by the details of each plan.
| For the Year Ended December 31, 2013 (Predecessor)
All Plans | Industrial Materials Segment |  | Engineered Solutions Segment |  | Corporate, R&D and Other |  | Total
| (Dollars in thousands)
Recorded in Cost of Sales |  |  |  |  |  |  |
Accelerated depreciation | $ | 28,326 |  |  | $ | — |  |  | $ | — |  |  | $ | 28,326 |
Inventory loss | 7,886 |  |  | 896 |  |  | — |  |  | 8,782 |
Fixed asset write-offs and other | 6,104 |  |  | 2,274 |  |  | — |  |  | 8,378 |
Recorded in Selling and General Administrative |  |  |  |  |  |
Other | 59 |  |  | — |  |  | — |  |  | 59 |
Recorded in Rationalizations |  |  |  |  |  |  |
Severance and related costs | 17,072 |  |  | 458 |  |  | 1,816 |  |  | 19,346 |
Contract terminations | 810 |  |  | — |  |  | — |  |  | 810 |
Total 2013 rationalization and related charges | $ | 60,257 |  |  | $ | 3,628 |  |  | $ | 1,816 |  |  | $ | 65,701 |
| For the Year Ended December 31, 2014 (Predecessor)
All Plans | Industrial Materials Segment |  | Engineered Solutions Segment |  | Corporate, R&D and Other |  | Total
| (Dollars in thousands)
Recorded in Cost of Sales |  |  |  |  |  |  |
Accelerated depreciation | $ | 22,388 |  |  | $ | 3,649 |  |  | $ | — |  |  | $ | 26,037 |
Inventory loss | 961 |  |  | 13,711 |  |  | — |  |  | 14,672 |
Fixed asset write-offs and other | 5,552 |  |  | 1,278 |  |  | — |  |  | 6,830 |
Recorded in Research and Development |  |  |  |  |  |
Accelerated depreciation | — |  |  | — |  |  | 2,312 |  |  | 2,312 |
Recorded in Selling and General Administrative |  |  |  |  |  |  |
Accelerated depreciation | — |  |  | — |  |  | 608 |  |  | 608 |
Other | 89 |  |  | 121 |  |  | 515 |  |  | 725 |
Recorded in Rationalizations |  |  |  |  |  |  |
Severance and related costs | 5,040 |  |  | 3,113 |  |  | 2,845 |  |  | 10,998 |
Contract terminations | 469 |  |  | 146 |  |  | 11 |  |  | 626 |
Impairment of long-lived assets | — |  |  | 121,570 |  |  | — |  |  | 121,570 |
Total 2014 rationalization and related charges | $ | 34,499 |  |  | $ | 143,588 |  |  | $ | 6,291 |  |  | $ | 184,378 |
| For the Period January 1 Through August 14, 2015 (Predecessor)
All Plans | Industrial Materials Segment |  | Engineered Solutions Segment |  | Corporate, R&D and Other |  | Total
| (Dollars in thousands)
Recorded in Cost of Sales |  |  |  |  |  |  |
Accelerated depreciation | $ | 432 |  |  | $ | — |  |  | $ | 940 |  |  | 1,372 |
Inventory loss | (33 | ) |  | 975 |  |  | — |  |  | 942 |
Fixed asset write-offs and other | 1,715 |  |  | 1,078 |  |  | — |  |  | 2,793 |
Recorded in Selling and General Administrative |  |  |  |  |  |
Other | 400 |  |  | 755 |  |  | 954 |  |  | 2,109 |
Recorded in Rationalizations |  |  |  |  |  |  |
Severance and related costs | 157 |  |  | 4,288 |  |  | (168 | ) |  | 4,277 |
Contract terminations | 25 |  |  | 204 |  |  | — |  |  | 229 |
Total | $ | 2,696 |  |  | $ | 7,300 |  |  | $ | 1,726 |  |  | $ | 11,722 |
| For the Period August 15 Through December 31, 2015 (Successor)
All Plans | Industrial Materials Segment |  | Engineered Solutions Segment |  | Corporate, R&D and Other |  | Total
| (Dollars in thousands)
Recorded in Cost of Sales |  |  |  |  |  |  |
Inventory loss | $ | (639 | ) |  | $ | 206 |  |  | $ | — |  |  | $ | (433 | )
Fixed asset write-offs and other | 329 |  |  | 697 |  |  | — |  |  | 1,026 |
Recorded in Selling and General Administrative |  |  |  |  |  |
Other | 135 |  |  | 1,323 |  |  | 290 |  |  | 1,748 |
Recorded in Rationalizations |  |  |  |  |  |  |
Severance and related costs | 154 |  |  | 769 |  |  | 71 |  |  | 994 |
Contract terminations | 59 |  |  | 22 |  |  | — |  |  | 81 |
Total | $ | 38 |  |  | $ | 3,017 |  |  | $ | 361 |  |  | $ | 3,416 |
2013 Industrial Materials Rationalization On October 31, 2013, we announced a global initiative to reduce our Industrial Materials segment's cost base and improve our competitive position. As part of this initiative, we ceased production at our two highest cost graphite electrode plants, located in Brazil and South Africa, as well as a machine shop in Russia. Our graphite electrode capacity was reduced by approximately 60,000 metric tons as a result of these actions. In parallel, we adopted measures for reductions in overhead and related corporate operations. These actions and measures reduced global headcount by approximately 600 people, or approximately 20 percent of our global workforce. These actions were substantially completed during the first half of 2014. 2013 Engineered Solutions Rationalization In order to optimize our Engineered Solutions platform and improve our cost structure, we also initiated actions to centralize certain operations and reduce overhead in our Engineered Solutions segment. These actions reduced global headcount by approximately 40 people and were substantially completed during 2014. Charges incurred related to the 2013 rationalization initiatives for the year ended December 31, 2014 and 2015 are as follows:
| For the Year Ended December 31, 2013
2013 Plans | Industrial Materials Segment |  | Engineered Solutions Segment |  | Corporate, R&D and Other |  | Total
| (Dollars in thousands)
Recorded in Cost of Sales |  |  |  |  |  |  |
Accelerated depreciation | $ | 28,326 |  |  | $ | — |  |  | $ | — |  |  | $ | 28,326 |
Inventory loss | 7,886 |  |  | 896 |  |  | — |  |  | 8,782 |
Fixed asset write-offs and other | 6,104 |  |  | 2,274 |  |  | — |  |  | 8,378 |
Recorded in Selling and General Administrative |  |  |  |  |  |
Other | 59 |  |  | — |  |  | — |  |  | 59 |
Recorded in Rationalizations |  |  |  |  |  |  |
Severance and related costs | 17,072 |  |  | 458 |  |  | 1,816 |  |  | 19,346 |
Contract terminations | 810 |  |  | — |  |  | — |  |  | 810 |
Total 2013 rationalization plan and related charges | $ | 60,257 |  |  | $ | 3,628 |  |  | $ | 1,816 |  |  | $ | 65,701 |
| For the Year Ended December 31, 2014
2013 Plans | Industrial Materials Segment |  | Engineered Solutions Segment |  | Corporate, R&D and Other |  | Total
| (Dollars in thousands)
Recorded in Cost of Sales |  |  |  |  |  |  |
Accelerated depreciation | $ | 22,388 |  |  | 827 |  |  | — |  |  | 23,215 |
Inventory loss | 961 |  |  | 485 |  |  | — |  |  | 1,446 |
Fixed asset write-offs and other | 5,374 |  |  | 233 |  |  |  |  | 5,607 |
Recorded in Selling and General Administrative |  |  |  |  |  |
Other | 89 |  |  | — |  |  |  |  | 89 |
Recorded in Rationalizations |  |  |  |  |  |  |  |  |  |  |
Severance and related costs | 433 |  |  | (28 | ) |  | — |  |  | 405 |
Contract terminations | 469 |  |  | — |  |  | — |  |  | 469 |
Total 2013 rationalization plan and related charges | $ | 29,714 |  |  | $ | 1,517 |  |  | $ | — |  |  | $ | 31,231 |
| For the Period January 1 Through August 14, 2015 (Predecessor)
2013 Plans | Industrial Materials Segment |  | Engineered Solutions Segment |  | Corporate, R&D and Other |  | Total
| (Dollars in thousands)
Recorded in Cost of Sales |  |  |  |  |  |  |
Accelerated depreciation | $ | 432 |  |  | — |  |  | — |  |  | 432 |
Inventory loss | (33 | ) |  | — |  |  | — |  |  | (33 | )
Fixed asset write-offs and other | 1,715 |  |  | 270 |  |  |  |  | 1,985 |
Recorded in Rationalizations |  |  |  |  |  |  |  |
Severance and related costs | 97 |  |  | 156 |  |  | — |  |  | 253 |
Contract terminations | 25 |  |  | — |  |  | — |  |  | 25 |
Total 2013 rationalization plan and related charges | $ | 2,236 |  |  | $ | 426 |  |  | $ | — |  |  | $ | 2,662 |
| For the Period August 15 Through December 31, 2015 (Successor)
2013 Plans | Industrial Materials Segment |  | Engineered Solutions Segment |  | Corporate, R&D and Other |  | Total
| (Dollars in thousands)
Recorded in Cost of Sales |  |  |  |  |  |  |
Inventory loss | $ | (278 | ) |  | $ | (29 | ) |  |  |  | $ | (307 | )
Fixed asset write-offs and other | 329 |  |  | 71 |  |  |  |  | 400 |
Recorded in Selling and General Administrative |  |  |  |  |  |
Other | 245 |  |  | — |  |  | — |  |  | 245 |
Recorded in Rationalizations |  |  |  |  |  |  |  |
Severance and related costs | 177 |  |  | — |  |  | — |  |  | 177 |
Contract terminations | 59 |  |  | — |  |  | — |  |  | 59 |
Total 2013 rationalization plan and related charges | $ | 532 |  |  | $ | 42 |  |  | $ | — |  |  | $ | 574 |
During the second quarter of 2015, in connection with our rationalization initiatives, two sites, located in Salvador, Brazil and Pennsylvania, United States, substantially completed their decommissioning efforts and met the criteria for assets held for sale. Because the carrying value of the sites did not exceed their estimated fair value, no additional impairment was recorded. Our Pennsylvania facility was sold in the third quarter of 2015 for a gain of $0.3 million. Additionally, during the third quarter of 2015, our facility in Meyerton, South Africa substantially completed their decommissioning efforts and met the criteria for assets held for sale. As of December 31, 2015, the sites held for sale represent $6.6 million of assets reported under "Property, plant and equipment" and $1.2 million of liabilities, reported under "Other accrued liabilities". The following table represents the roll-forward of the liability incurred for employee termination benefits and contract termination costs incurred in connection with the rationalization initiatives described above. This liability is recorded as a current liability on the Consolidated Balance Sheet.
| (Dollars in thousands)
Balance as of December 31, 2013 | $ | 18,421 |
Charges incurred | 613 |
Change in estimates | 153 |
Payments and settlements | (16,494 | )
Effect of change in currency exchange rates | (1,658 | )
Balance as of December 31, 2014 | 1,035 |
Charges incurred | 40 |
Change in estimates | 227 |
Payments and settlements | (1,102 | )
Effect of change in currency exchange rates | (155 | )
Balance as of August 14, 2015 | $ | 45 |
Charges incurred | 154 |
Change in estimates | 67 |
Payments and settlements | (17 | )
Effect of change in currency exchange rates | (59 | )
Balance as of December 31, 2015 | $ | 190 |
2014 Engineered Solutions Rationalization On July 29, 2014, we announced additional rationalization initiatives to increase profitability, reduce cost and improve global competitiveness in our Engineered Solutions segment. During the second quarter of 2014, worldwide pricing of our isomolded graphite products ("isomolded") within our Advanced Graphite Material ("AGM") product group, as well as our expectation of future pricing, significantly eroded, driven by significant over-capacity and recent competitor responses. In addition, solar product demand continued to erode, with polysilicon, silicon and silicon wafer production migrating to China. New competitors servicing this industry commenced production in China at pricing levels making the market now unprofitable. As a result of these conditions, the Company decided to cease isomolded production and pursue alternative supply chain relationships in our isomolded product line. As a result of the above, we tested our long-lived assets used to produce advanced graphite materials for recovery, based on undiscounted cash flows from the use and eventual disposition of these assets. The carrying value of the assets exceeded these undiscounted cash flow and, accordingly, we estimated the fair-value of these long-lived assets based on a market participant view. This resulted in an impairment charge totaling $121.6 million during 2014, and included the impairment of certain acquired customer relationship and technology intangible assets. The 2014 Engineered Solutions Rationalization program was completed during 2015. Charges incurred related to the 2014 Engineered Solutions rationalization initiatives in 2014 and 2015 are as follows:
|  | Predecessor |  | Successor
2014 Engineered Solutions Rationalization |  | For the Year Ended December 31, 2014 |  | For the Period January 1, 2015 Through August 14, 2015 |  | For the Period August 15, 2015 Through December 31, 2015
|  | Engineered Solutions Segment
|  | (Dollars in thousands)
Recorded in Cost of Sales |  |
Accelerated depreciation |  | $ | 2,802 |  |  | $ | — |  |  | $ | — |
Inventory loss |  | 13,225 |  |  | 571 |  |  | (80 | )
Fixed asset write-offs and other |  | 1,046 |  |  | 372 |  |  | (229 | )
Recorded in Rationalizations |  |
Severance and related costs |  | 2,498 |  |  | (713 | ) |  | — |
Contract terminations |  | 195 |  |  | 50 |  |  | — |
Total |  | $ | 19,766 |  |  | $ | 280 |  |  | $ | (309 | )
The following table represents the roll-forward of the liability incurred for employee termination benefits and contract termination costs incurred in connection with the 2014 Engineered Solutions rationalization initiatives described above. This liability is recorded as a current liability on the Consolidated Balance Sheet.
| (Dollars in thousands)
Balance as of December 31, 2013 | $ | — |
Charges incurred | 2,611 |
Change in estimates | (40 | )
Payments and settlements | (916 | )
Effect of change in currency exchange rates | — |
Balance as of December 31, 2014 | $ | 1,655 |
Charges incurred | 50 |
Change in estimates | (713 | )
Payments and settlements | (916 | )
Effect of change in currency exchange rates | 1 |
Balance as of August 14, 2015 | $ | 77 |
Change in estimates | (5 | )
Payments and settlements | (72 | )
Balance as of December 31, 2015 | $ | — |
2014 Corporate and Research & Development Rationalization During the third quarter of 2014, we announced the conclusion of another phase of our on-going company-wide cost savings assessment. This resulted in changes to the Company’s operating and management structure in order to streamline, simplify and decentralize the organization. These actions were designed to reduce costs by a combination of reduced contractor costs, attrition, early retirements and layoffs. Additionally, the Company downsized its corporate functions by approximately 25 percent, relocated to a smaller, more cost effective corporate headquarters and established a new Technology and Innovation Center. Charges incurred related to the 2014 Corporate and Research & Development rationalization initiatives for 2014 and 2015 are as follows:
2014 Corporate, Research and Development Plan |  | For the Year Ended December 31, 2014 (Predecessor) |
| Industrial Materials Segment |  | Engineered Solutions Segment |  | Corp, R&D and Other |  | Total |
|  | (Dollars in thousands) |
Recorded in Cost of Sales |  |  |
Accelerated depreciation |  | $ | — |  |  | $ | 20 |  |  | $ | — |  |  | $ | 20 |  |
Fixed asset write-offs and other |  | 178 |  |  | — |  |  | — |  |  | 178 |  |
Recorded in Research and Development |  |  |
Accelerated depreciation |  | — |  |  | — |  |  | 2,312 |  |  | 2,312 |  |
Recorded in Selling and General Administrative |  |  |
Accelerated depreciation |  | — |  |  | — |  |  | 608 |  |  | 608 |  |
Other |  | — |  |  | — |  |  | 515 |  |  | 515 |  |
Recorded in Rationalizations |  |  |
Severance and related costs |  | 4,608 |  |  | 644 |  |  | 2,844 |  |  | 8,096 |  |
Contract terminations |  | — |  |  | 73 |  |  | 11 |  |  | 84 |  |
Total |  | $ | 4,786 |  |  | $ | 737 |  |  | $ | 6,290 |  |  | $ | 11,813 |  |
2014 Corporate, Research and Development Plan |  | For the Period January 1 Through August 14, 2015 (Predecessor) |
| Industrial Materials Segment |  | Engineered Solutions Segment |  | Corp, R&D and Other |  | Total |
|  | (Dollars in thousands) |
Recorded in Cost of Sales |  |  |
Fixed asset write-offs and other |  | $ | — |  |  | $ | 1 |  |  | $ | — |  |  | $ | 1 |  |
Recorded in Research and Development |  |  |
Accelerated depreciation |  | — |  |  | — |  |  | 940 |  |  | 940 |  |
Recorded in Selling and General Administrative |  |  |
Other |  | 400 |  |  | — |  |  | 954 |  |  | 1,354 |  |
Recorded in Rationalizations |  |  |
Severance and related costs |  | 60 |  |  | 8 |  |  | (168 | ) |  | (100 | ) |
Total |  | $ | 460 |  |  | $ | 9 |  |  | $ | 1,726 |  |  | $ | 2,195 |  |
2014 Corporate, Research and Development Plan |  | For the Period August 15 Through December 31, 2015 (Successor) |
| Industrial Materials Segment |  | Engineered Solutions Segment |  | Corp, R&D and Other |  | Total |
|  | (Dollars in thousands) |
Recorded in Selling and General Administrative |  |  |
Other |  | $ | — |  |  | $ | — |  |  | $ | 290 |  |  | $ | 290 |  |
Recorded in Rationalizations |  |  |
Severance and related costs |  | (23 | ) |  | — |  |  | 71 |  |  | 48 |  |
Total |  | $ | (23 | ) |  | $ | — |  |  | $ | 361 |  |  | $ | 338 |  |
The 2014 Corporate and Research and Development rationalization plan will result in approximately $20 million of charges consisting of severance, accelerated depreciation and other related costs. Approximately $12 million of these costs will be cash outlays, the majority of which were disbursed in 2015. During the fourth quarter of 2015, our facility in Parma, Ohio substantially completed their decommissioning efforts and met the criteria for assets held for sale. As of December 31, 2015, the site held for sale represents $3.9 million of assets reported under "Property, plant and equipment" and $3.6 million of liabilities, reported under "Other accrued liabilities". The following table represents the roll-forward of the liability incurred for employee termination benefits and contract termination costs incurred in connection with the 2014 Corporate and Research & Development rationalization initiatives described above. This liability is recorded as a current liability on the Consolidated Balance Sheet.
| (Dollars in thousands)
Balance as of December 31, 2013 | $ | — |
Charges incurred | 8,159 |
Change in estimates | 21 |
Payments and settlements | (1,155 | )
Effect of change in currency exchange rates | (152 | )
Balance as of December 31, 2014 | $ | 6,873 |
Charges incurred | (33 | )
Change in estimates | (67 | )
Payments and settlements | (4,611 | )
Effect of change in currency exchange rates | (81 | )
Balance as of August 14, 2015 | $ | 2,081 |
Change in estimates | 47 |
Payments and settlements | (1,127 | )
Effect of change in currency exchange rates | (57 | )
Balance as of December 31, 2015 | $ | 944 |
2015 Advanced Graphite Materials Rationalization On March 2, 2015, GrafTech announced plans to further optimize the production platform for its advanced graphite materials business. These actions included the closure of our Notre Dame, France facility and further reductions in force in our Columbia, Tennessee facility and other locations totaling approximately 85 people. Charges incurred related to the 2015 Advanced Graphite Materials rationalization initiative are as follows:
| Predecessor |  | Successor
2015 Advanced Graphite Materials Rationalization |  | For the Period January 1 Through August 14, 2015 |  | For the Period August 15 Through December 31, 2015
| Engineered Solutions Segment
| (Dollars in thousands)
Recorded in Cost of Sales |  |  |
Inventory loss |  | $ | 404 |  |  | $ | (47 | )
Fixed asset write-offs and other |  | 434 |  |  | 855 |
Recorded in Selling and General Administrative |  |  |
Other |  | 755 |  |  | 1,213 |
Recorded in Rationalizations |  |  |
Severance and related costs |  | 4,838 |  |  | 769 |
Contract terminations |  | 154 |  |  | 22 |
Total |  | $ | 6,585 |  |  | $ | 2,812 |
The following table represents the roll-forward of the liability incurred for employee termination benefits and contract termination costs incurred in connection with the 2015 Advanced Graphite Materials rationalization initiative described above. This liability is included in "Rationalizations" on the Consolidated Balance Sheets.
2015 Advanced Graphite Materials Rationalization
| (Dollars in thousands)
Balance as of December 31, 2014 | $ | — |
Charges incurred | 5,053 |
Change in estimates | (38 | )
Payments and settlements | (329 | )
Effect of change in currency exchange rates | — |
Balance as of August 14, 2015 | $ | 4,686 |
Charges incurred | 647 |
Payments and settlements | (3,418 | )
Balance as of December 31, 2015 | $ | 1,915 |

X
- References No definition available. + Details
Name: | us-gaap_RestructuringAndRelatedActivitiesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB TOPIC 5.P.4) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140904-122747 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 5.P.3) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140864-122747 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 5 -Section P -Subsection 3, 4 + Details
Name: | us-gaap_RestructuringAndRelatedActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration