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Note 6 - Restructuring and Other Exit Costs

12 Months Ended

Dec. 31, 2020

Notes to Financial Statements

Restructuring and Related Activities Disclosure [Text Block]

6.

Restructuring and Other Exit Costs

On an ongoing basis, the Company reviews the global economy, the healthcare industry, and the markets in which it competes to identify operational efficiencies, enhance commercial capabilities and align its cost base and infrastructure with customer needs and its strategic plans. In order to realize these opportunities, the Company undertakes restructuring-type activities from time to time to transform its business.

During 2019, the Company initiated a restructuring program designed to improve gross margins and operating margins while reinvesting in resources required to deliver sustained, profitable organic growth. The restructuring program entails consolidating and downsizing several sites and includes headcount reductions in Europe and North America to improve operational efficiency and reduce costs. The restructuring program is expected to be substantially completed by the first half of 2021. Costs associated with the program include headcount reductions, program management and other transition costs necessary to affect the site consolidations and other business improvements.

The following table summarizes the activity for accrued restructuring liability for the years ended December 31, 2020 and 2019:

		Cost of				Severance
(in thousands)		Revenue				Costs				Impairment				Other				Total
Restructuring and other exit costs		$	235			$	530			$	460			$	129			$	1,354
Non-cash charges			(235	)			-				(460	)			(10	)			(705	)
Cash payments			-				(166	)			-				(115	)			(281	)
Balance at December 31, 2019			-				364				-				4				368
Restructuring and other exit costs			-				1,625				-				408				2,033
Non-cash charges			-				-				-				(168	)			(168	)
Cash payments			-				(1,719	)			-				(226	)			(1,945	)
Balance at December 31, 2020		$	-			$	270			$	-			$	18			$	288

As of December 31, 2020, the Company had a restructuring liability of $0.3 million which is payable within the next twelve months and has been included in other current liabilities in the consolidated balance sheet.

During the year ended December 31, 2019, the Company recorded restructuring plan related impairment charges of $0.5 million to write-off certain intangible assets as a result of a decision to discontinue a product line and cease operations in its facility in North Carolina.

Restructuring costs of $2.0 million incurred during the year ended December 31, 2020, have been included as a component of selling, general and administrative expenses. Of the $1.4 million restructuring costs incurred during the year ended December 31, 2019, $0.5 million has been recorded as impairment of intangible assets, $0.2 million has been included in cost of revenues, and the remaining costs of $0.7 million have been included as a component of selling, general and administrative expenses.