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Restructuring, Acquisition and Divestiture Related Costs
12 Months Ended
Dec. 31, 2018
Restructuring And Related Activities [Abstract]  
Restructuring, Acquisition and Divestiture Related Costs

16. Restructuring, Acquisition and Divestiture Related Costs

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

 

 

Year Ended December 31,

 

 

2018

 

 

2017

 

 

2016

 

2019 restructuring

$

             378

 

 

$

 

 

$

 

2018 restructuring

 

1,647

 

 

 

 

 

 

 

2016 restructuring

 

 

 

 

332

 

 

 

3,049

 

2011 restructuring

 

 

 

 

14

 

 

 

(79

)

Total restructuring and divestiture related charges

$

2,025

 

 

$

346

 

 

$

2,970

 

Acquisition and related charges

 

6,016

 

 

 

7,196

 

 

 

4,975

 

Total restructuring, acquisition and divestiture related costs

$

8,041

 

 

$

7,542

 

 

$

7,945

 

2019 Restructuring

During the fourth quarter of 2018, the Company implemented a restructuring plan intended to realign operations, reduce costs, achieve operational efficiencies and focus resources on growth initiatives. In 2018, the Company recorded $0.4 million in severance and related costs in connection with the 2019 restructuring plan. These costs were primarily reported in the Vision reportable segment. The Company anticipates completing the 2019 restructuring program in 2019 and expects to incur restructuring charges of $2.0 million to $3.5 million related to the 2019 restructuring program in the next twelve months.

 

2018 Restructuring

During the second quarter of 2018, the Company initiated a program to integrate manufacturing operations as a result of recent acquisition activities. In 2018, the Company recorded $1.6 million in severance and related costs in connection with the 2018 restructuring plan. The Company anticipates completing the 2018 restructuring program during the third quarter of 2019.

 

The following table summarizes restructuring costs incurred to date and the Company’s expected cumulative costs associated with the 2018 restructuring program (in thousands):

 

 

Year Ended

 

 

Expected Cumulative Costs

 

 

December 31, 2018

 

 

December 31, 2018

 

Photonics

$

 

 

$

 

Vision

 

1,579

 

 

$2,300 - $2,600

 

Precision Motion

 

 

 

 

 

Unallocated Corporate and Shared Services

 

68

 

 

 

$100

 

Total

$

1,647

 

 

$

$2,400 - $2,700

 

2016 Restructuring

During the third quarter of 2015, the Company initiated the 2016 restructuring program, which included consolidating certain manufacturing operations to optimize facility footprint and better utilize resources, and reducing redundant costs due to productivity cost savings and business volume reductions. As of December 31, 2017, the Company incurred cumulative costs related to this restructuring plan totaling $6.5 million, net of the gain on the sale of the Chatsworth, California facility. The plan was completed in 2017.

The following table summarizes restructuring costs associated with the 2016 restructuring program for each segment and unallocated corporate costs (in thousands):

 

 

Year Ended

Cumulative

Costs as of

 

 

December 31, 2017

 

 

December 31, 2016

 

 

December 31, 2017

 

Photonics

$

 

 

$

813

 

 

$

868

 

Vision

 

331

 

 

 

1,862

 

 

 

4,393

 

Precision Motion

 

 

 

 

106

 

 

 

939

 

Unallocated Corporate and Shared Services

 

1

 

 

 

268

 

 

 

329

 

Total

$

332

 

 

$

3,049

 

 

$

6,529

 

 

2011 Restructuring

In November 2011, the Company announced a strategic initiative (“2011 restructuring”) which aimed to consolidate operations to reduce the Company’s cost structure and improve operational efficiency. In total, eleven facilities have been exited as part of the 2011 restructuring plan. The Company substantially completed the 2011 restructuring program in 2013. In March 2016, the Company sold its previously exited Laser Systems facility located in Orlando, Florida for cash at the net carrying value of $3.5 million. In December 2016, the lease agreement for the Company’s previously exited laser scanner business facility was terminated, which resulted in a benefit of $0.2 million.

The following table summarizes restructuring costs for each segment and unallocated corporate costs related to the 2011 restructuring plan (in thousands):

 

 

 

 

 

 

 

 

 

 

Cumulative

 

 

Year Ended December 31,

 

 

Costs as of

 

 

2017

 

 

2016

 

 

December 31, 2017

 

Photonics

$

 

 

$

(188

)

 

$

1,751

 

Vision

 

 

 

 

 

 

 

48

 

Precision Motion

 

 

 

 

 

 

 

122

 

Unallocated Corporate and Shared Services

 

14

 

 

 

109

 

 

 

3,276

 

Total

$

14

 

 

$

(79

)

 

$

5,197

 

 

Rollforward of Accrued Expenses Related to Restructuring

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

 

 

Total

 

 

Severance

 

 

Facility

 

 

Other (a)

 

Balance at December 31, 2016

$

1,736

 

 

$

611

 

 

$

1,111

 

 

$

14

 

Restructuring charges

 

346

 

 

 

185

 

 

 

146

 

 

 

15

 

Cash payments

 

(1,212

)

 

 

(692

)

 

 

(503

)

 

 

(17

)

Non-cash write-offs and other adjustments

 

(64

)

 

 

(65

)

 

 

9

 

 

 

(8

)

Balance at December 31, 2017

 

806

 

 

 

39

 

 

 

763

 

 

 

4

 

Restructuring charges

 

2,025

 

 

 

1,862

 

 

 

 

 

 

163

 

Cash payments

 

(1,490

)

 

 

(962

)

 

 

(373

)

 

 

(155

)

Non-cash write-offs and other adjustments

 

(65

)

 

 

(63

)

 

 

(2

)

 

 

 

Balance at December 31, 2018

$

1,276

 

 

$

876

 

 

$

388

 

 

$

12

 

 

 

(a)

Other restructuring charges mainly related to consulting fees and relocation costs.

The Company expects to make $1.1 million in cash payments during the twelve months ending December 31, 2019.

Acquisition and Divestiture Related Charges

Acquisition related costs incurred to effect business combinations, primarily including finders’ fees, legal, valuation and other professional or consulting fees, totaled $1.4 million, $6.8 million, and $2.5 million during 2018, 2017, and 2016, respectively. Acquisition related costs recognized under earn-out agreements in connection with acquisitions totaled $4.6 million, $0.4 million, and $2.5 million during 2018, 2017, and 2016, respectively. The majority of acquisition related costs for 2018 were included in the Company’s Precision Motion reportable segment.