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Restructuring, Acquisition, and Related Costs
6 Months Ended
Jun. 30, 2023
Restructuring and Related Activities [Abstract]  
Restructuring, Acquisition, and Related Costs

13. Restructuring, Acquisition, and Related Costs

The following table summarizes restructuring, acquisition, and related costs in the accompanying consolidated statements of operations (in thousands):

 

Three Months Ended

 

 

Six Months Ended

 

 

June 30,

 

 

July 1,

 

 

June 30,

 

 

July 1,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

2022 restructuring

$

677

 

 

$

 

 

$

2,874

 

 

$

 

2020 restructuring

 

459

 

 

 

610

 

 

 

733

 

 

 

1,232

 

Total restructuring charges

 

1,136

 

 

 

610

 

 

 

3,607

 

 

 

1,232

 

Acquisition and related charges

 

98

 

 

 

2,045

 

 

 

103

 

 

 

(207

)

Total restructuring, acquisition, and related costs

$

1,234

 

 

$

2,655

 

 

$

3,710

 

 

$

1,025

 

2022 Restructuring

As a result of the Company’s ongoing evaluations and efforts to reduce its operating costs, while improving efficiency and effectiveness, the Company initiated the 2022 restructuring program in the third quarter of 2022. This program is focused on reducing operating complexity in the Company, including reducing infrastructure costs and streamlining the Company’s operating model to better serve its customers. In addition, the program is focused on cost reduction actions that improve gross margins for the overall company in line with the Company's multi-year gross margin expansion program. During the three and six months ended June 30, 2023, the Company recorded $0.7 million and $2.9 million, respectively, in severance and other charges in connection with the 2022 restructuring program. As of June 30, 2023, the Company had incurred cumulative costs of $4.3 million related to this restructuring plan. The Company anticipates substantially completing the 2022 restructuring program by the end of 2023 and expects to incur additional restructuring charges of $1.5 million to $2.0 million related to the 2022 restructuring program.

The following table summarizes restructuring costs associated with the 2022 restructuring program by reportable segment (in thousands):

 

Three Months Ended

 

 

Six Months Ended

 

 

June 30,

 

 

July 1,

 

 

June 30,

 

 

July 1,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Precision Medicine and Manufacturing

$

265

 

 

$

 

 

$

988

 

 

$

 

Medical Solutions

 

35

 

 

 

 

 

 

40

 

 

 

 

Robotics and Automation

 

266

 

 

 

 

 

 

1,536

 

 

 

 

Unallocated Corporate and Shared Services

 

111

 

 

 

 

 

 

310

 

 

 

 

Total

$

677

 

 

$

 

 

$

2,874

 

 

$

 

 

2020 Restructuring

The Company initiated the 2020 restructuring program in the third quarter of 2020. This program is focused on reducing operating complexity in the Company, including reducing infrastructure costs and streamlining the Company’s operating model to better serve its customers. In addition, the program is focused on cost reduction actions that improve gross margins for the overall company. During the three and six months ended June 30, 2023, the Company recorded $0.5 million and $0.7 million respectively, in severance and other costs in connection with the 2020 restructuring program. As of June 30, 2023, the Company had incurred cumulative costs of $14.6 million related to this restructuring plan. The 2020 restructuring program is expected to be completed in 2023 and to incur additional restructuring charges of $0.5 million to $1.0 million.

The following table summarizes restructuring costs associated with the 2020 restructuring program by reportable segment (in thousands):

 

Three Months Ended

 

 

Six Months Ended

 

 

June 30,

 

 

July 1,

 

 

June 30,

 

 

July 1,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Precision Medicine and Manufacturing

$

301

 

 

$

501

 

 

$

507

 

 

$

1,194

 

Medical Solutions

 

 

 

 

65

 

 

 

 

 

 

106

 

Robotics and Automation

 

158

 

 

 

44

 

 

 

226

 

 

 

(68

)

Total

$

459

 

 

$

610

 

 

$

733

 

 

$

1,232

 

Rollforward of Accrued Expenses Related to Restructuring

The following table summarizes the accrual activities, by component, related to the Company’s restructuring plans recorded in the accompanying consolidated balance sheets (in thousands):

 

Total

 

 

Employee Related

 

 

Facility Related

 

 

Other

 

Balance at December 31, 2022

$

2,410

 

 

$

1,902

 

 

$

452

 

 

$

56

 

Restructuring charges

 

3,607

 

 

 

2,587

 

 

 

244

 

 

 

776

 

Cash payments

 

(3,185

)

 

 

(2,136

)

 

 

(258

)

 

 

(791

)

Non-cash charges and other adjustments

 

55

 

 

 

36

 

 

 

19

 

 

 

 

Balance at June 30, 2023

$

2,887

 

 

$

2,389

 

 

$

457

 

 

$

41

 

 

Acquisition and Related Charges

Acquisition costs in connection with business combinations, including finders’ fees, legal, valuation, and other professional or consulting fees, totaled $0.1 million for both the three and six months ended June 30, 2023, and $0.2 million and $0.3 million for the three and six months ended July 1, 2022, respectively. During the three and six months ended July 1, 2022, the Company recognized $1.8 million and $(0.5) million, respectively, in earn-out expenses related to prior-year acquisitions. The majority of acquisition and related costs for the three and six months ended June 30, 2023 were included in the Company’s Unallocated Corporate and Shared Services reportable segment. The majority of acquisition and related costs for the three and six months ended July 1, 2022 were included in the Company’s Precision Medicine and Manufacturing, Robotics and Automation, and Unallocated Corporate and Shared Services reportable segments.