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Restructuring and Asset Related Charges - Net | 9 Months Ended
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Sep. 30, 2017
Restructuring Charges [Abstract] |
Employee Separation / Asset Related Charges, Net | DowDuPont Cost Synergy Program In September 2017, DowDuPont approved initial post-merger actions under the DowDuPont Cost Synergy Program (the “Synergy Program”) which is designed to integrate and optimize the organization following the Merger and Intended Business Separations. In connection with the approved actions under the Synergy Program, DuPont expects to incur pre-tax charges of approximately $70 million, comprised primarily of severance and related benefit costs. For the period September 1 through September 30, 2017, the company recognized pre-tax charges of $40 million in restructuring and asset related charges - net in the company's interim Consolidated Statements of Operations. These actions are expected to be substantially complete by the end of 2018. DuPont account balances and activity for the DowDuPont Cost Synergy Program are summarized below:
(In millions) | Severance and Related Benefit Costs
Charges to (loss) income from continuing operations for the period September 1 through September 30, 2017 (Successor) | $ | 40 |
Payments | (1 | )
Non-cash compensation | (7 | )
Balance as of September 30, 2017 | $ | 32 |
On November 1, 2017, the company approved additional restructuring actions under the Synergy Program, adopted by the DowDuPont Board of Directors. Based on all actions approved to date under the Synergy Program, DuPont expects to record total pre-tax restructuring charges of about $850 million, comprised of approximately $350 million to $400 million of severance and related benefits costs; up to $360 million of asset related charges, and $110 million to $140 million of costs related to contract terminations. DuPont’s current estimated total pre-tax restructuring charges include the $40 million recorded for the period September 1 through September 30, 2017, comprised of severance and related benefit costs. DuPont expects to record pre-tax restructuring charges of approximately $115 million in the fourth quarter of 2017, with the remaining restructuring charges to be incurred by the end of 2019. The Synergy Program includes certain asset actions, including strategic decisions regarding the cellulosic biofuel business reflected in the preliminary fair value measurement of DuPont’s assets as of the merger date. Current estimated total pre-tax restructuring charges could be impacted by future adjustments to the preliminary fair value of DuPont’s assets. 2017 Restructuring Program During the first quarter 2017, DuPont committed to take actions to improve plant productivity and better position its businesses for productivity and growth before and after the anticipated closing of the Merger Transaction (the "2017 restructuring program"). In connection with these actions, the company incurred pre-tax charges of $1 million and $313 million, during the period July 1 through August 31, 2017 and January 1 through August 31, 2017 ("Predecessor" periods), respectively, recognized in restructuring and asset related charges - net in the company's interim Consolidated Statements of Operations. The charge for the period July 1 through August 31, 2017 is severance and related benefit costs. The charge for the period January 1 through August 31, 2017 is comprised of $279 million of asset-related charges and $34 million in severance and related benefit costs. The charges primarily relate to the second quarter closure of the Protection Solutions business Cooper River manufacturing site located near Charleston, South Carolina. The asset-related charges mainly consist of accelerated depreciation associated with the closure. The actions associated with this plan are expected to be substantially complete by the end of 2017. Account balances and activity for the 2017 restructuring program are summarized below:
(In millions) | Severance and Related Benefit Costs | Asset Related Charges 1 | Total
Charges to income from continuing operations for the period January 1 through August 31, 2017 (Predecessor) | $ | 34 |  | $ | 279 |  | $ | 313 |
Payments | (8 | ) | — |  | (8 | )
Asset write-offs | — |  | (279 | ) | $ | (279 | )
Balance as of August 31, 2017 | $ | 26 |  | $ | — |  | $ | 26 |
Charges to income from continuing operations for the period September 1 through September 30, 2017 (Successor) | $ | — |  | $ | — |  | $ | — |
Payments | (1 | ) | — |  | (1 | )
Balance as of September 30, 2017 | $ | 25 |  | $ | — |  | $ | 25 |
1. | Includes accelerated depreciation related to site closure. Charge for accelerated depreciation represents the difference between the depreciation expense to be recognized over the revised useful life of the site, based upon the anticipated date the site will be closed and depreciation expense as determined utilizing the useful life prior to the restructuring action.
La Porte Plant, La Porte, Texas In March 2016, DuPont announced its decision to not re-start the Agriculture business's insecticide manufacturing facility at the La Porte site located in La Porte, Texas. The facility manufactured Lannate® and Vydate® insecticides and has been shut down since November 2014. As a result of this decision, during the nine months ended September 30, 2016, a pre-tax charge of $75 million was recorded in restructuring and asset related charges - net in the company's interim Consolidated Statement of Operations which included $41 million of asset related charges, $18 million of contract termination costs, and $16 million of employee severance and related benefit costs. 2016 Global Cost Savings and Restructuring Plan At September 30, 2017, total liabilities related to the program were $35 million. A complete discussion of restructuring initiatives is included in the company's 2016 Annual Report in Note 4, "Restructuring and Asset Related Charges - Net." In connection with these actions, the company incurred pre-tax charges of $10 million during the period July 1 through August 31, 2017, recognized in restructuring and asset related charges - net in the company’s interim Consolidated Statement of Operations. This was due to additional severance payments owed to previously terminated executives that became probable during the period. Account balances and activity for the restructuring program are summarized below:
(In millions) | Severance and Related Benefit Costs | Other Non-Personnel Charges 1 | Total
Balance at December 31, 2016 (Predecessor) | $ | 100 |  | $ | 22 |  | $ | 122 |
Payments | (76 | ) | (11 | ) | (87 | )
Net translation adjustment | 2 |  | — |  | 2 |
Other adjustments | 10 |  | — |  | 10 |
Balance as of August 31, 2017 | $ | 36 |  | $ | 11 |  | $ | 47 |
Balance at September 1, 2017 (Successor) | $ | 36 |  | $ | 11 |  | $ | 47 |
Payments | (11 | ) | (1 | ) | (12 | )
Balance as of September 30, 2017 | $ | 25 |  | $ | 10 |  | $ | 35 |
1. | Other non-personnel charges consist of contractual obligation costs.
During the three months ended September 30, 2016, a net charge of $17 million was recorded, consisting of $14 million of restructuring and asset related charges - net and $3 million in sundry income (expense) -net in the company's interim Consolidated Statement of Operations. During the nine months ended September 30, 2016, a net (benefit) charge of $(68) million was recorded, consisting of $(71) million in restructuring and asset related charges - net and $3 million in sundry income (expense)-net in the company's interim Consolidated Statement of Operations. This was primarily due to a reduction in severance and related benefit costs partially offset by the identification of additional projects in certain businesses. The reduction in severance and related benefit costs was driven by the elimination of positions at a lower cost than expected as a result of redeployments and attrition as well as lower than estimated individual severance costs. Asset Impairment During the third quarter 2016, the company recognized a $158 million pre-tax impairment charge in restructuring and asset related charges - net in the company's interim Consolidated Statements of Operations related to indefinite-lived intangible trade names within the Industrial Biosciences business. In connection with business strategy reviews and brand realignment conducted during the third quarter 2016, the company decided to phase out the use of certain acquired trade names within the business resulting in a change from an indefinite life to a finite useful life for these assets. As a result of these changes, the carrying value of the trade name assets exceeded the fair value. The basis of the fair value for the charges was calculated utilizing an income approach (relief from royalty method) using Level 3 inputs within the fair value hierarchy, as described in the company’s 2016 Annual Report in Note 1, “Summary of Significant Accounting Policies.” The key assumptions used in the calculation included projected revenue, royalty rates and discount rates. These key assumptions involve management judgment and estimates relating to future operating performance and economic conditions that may differ from actual cash flows. After the recognition of the impairment charge, the remaining net book value of the trade names was $28 million, which represented fair value.

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- 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 + Details
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