Repositioning Costs and Net Loss on Dispositions and Repositioning Liabilities

6 Months Ended

Jun. 30, 2020

Repositioning Costs and Net Loss on Dispositions and Repositioning Liabilities [Abstract]

Repositioning Costs and Net Loss on Dispositions and Repositioning Liabilities

Repositioning Costs and Net Loss on Dispositions and Repositioning Liabilities

In the second quarter of 2020, we took actions to align our cost structure, reduce our workforce and facility requirements and continued to review businesses for disposal and assets for impairment. As a result of these actions, we recorded a pre-tax charge of $277.9 million, which is comprised of incremental severance of $150.0 million, real estate operating lease ROU asset and other asset impairment charges of $55.8 million, other real estate exit costs of $47.0 million and dispositions and other charges of $25.1 million. We expect that substantially all the severance liability will be paid by the end of 2020. The liability for substantially all the other real estate exit costs will be paid over the applicable lease terms. The ROU asset impairment charge and the disposition and other charges are non-cash charges.

At June 30, 2020 and December 31, 2019, the liability for office lease consolidation and termination incurred in connection with our repositioning actions taken in the third quarter of 2018 was $13.8 million and $25.1 million, respectively. We expect that the remaining liability will be paid by the end of 2020.