RESTRUCTURING AND OTHER COST REDUCTION INITIATIVES

3 Months Ended

Mar. 31, 2021

Restructuring and Related Activities [Abstract]

RESTRUCTURING AND OTHER COST REDUCTION INITIATIVES

NOTE 10. RESTRUCTURING AND OTHER COST REDUCTION INITIATIVES

During 2020, management approved and implemented several restructuring actions and other cost reduction initiatives to optimize the Company’s North American manufacturing and supply chain operations, as well as eliminate certain corporate costs. As of March 31, 2021, all of the workforce reductions announced under these prior year actions have been completed. The facilities-related cost reduction measures initiated during the second half of 2020 are expected to be completed by the end of 2021.

During the first quarter of 2021, the Company executed on its previously disclosed plans to close or vacate five of its domestic showrooms. In connection therewith, the Company recognized non-cash asset impairment charges of approximately $0.9 million related to certain ROU assets and leasehold improvements. In addition, the Company expanded on its previously disclosed cost reduction actions with the commencement of various workforce reductions during the first quarter of 2021, some of which have been implemented and all of which are expected to be completed by the end of the third quarter of 2021, depending upon local legal requirements. These workforce reductions have occurred or will occur across all geographies in which the Company operates, and will result in the elimination of approximately 50 additional positions to those reported in 2020. The positions impacted are primarily within the Workplace segment.

The Company expects to incur additional charges of approximately $2.8 million, comprised of severance and other one-time termination benefits, facilities-related charges and other associated costs during the remainder of 2021. The Company anticipates making cash payments totaling approximately $5.8 million.

During the three months ended March 31, 2021, the Company recognized total restructuring charges of $3.6 million, attributable to the Workplace and Lifestyle segments in the amounts of $2.2 million and $0.2 million, respectively, and to Corporate in the amount of $1.2 million. During the three months ended March 31, 2020, the Company recognized total restructuring charges of $8.2 million, attributable to the Workplace and Lifestyle segments in the amounts of $7.9 million and $0.3 million, respectively.

Changes in restructuring obligations during the three months ended March 31, 2021 are summarized as follows:

	North America Operations Optimization		Workforce Reduction and Other Cost Initiatives		Total
Balance as of December 31, 2020	$	0.1	$	2.0	$	2.1
Provisions and accruals	0.8		1.9		2.7
Cash payments	(0.6)		(1.2)		(1.8)
Balance as of March 31, 2021	$	0.3	$	2.7	$	3.0

The restructuring reserve is classified as current and is included in Other current liabilities on the condensed consolidated balance sheets. All but an immaterial component of the reserve is expected to be utilized (settled in cash) during 2021.