XML 20 R9.htm IDEA: XBRL DOCUMENT v3.20.2
RESTRUCTURING
6 Months Ended
Sep. 26, 2020
Restructuring and Related Activities [Abstract]  
RESTRUCTURING
3. RESTRUCTURING

On an ongoing basis, the Company reviews the global economy, the healthcare industry, and the markets in which it competes to identify opportunities for efficiencies, enhance commercial capabilities, align its resources and offer its customers better solutions. In order to realize these opportunities, the Company undertakes restructuring-type activities to transform its business.
In July 2019, the Board of Directors of the Company approved a new Operational Excellence Program (the "2020 Program") and delegated authority to the Company's management to determine the detail of the initiatives that will comprise the program. The 2020 Program is designed to improve operational performance and reduce cost principally in our manufacturing and supply chain operations. The Company estimates that it will incur aggregate charges between $60 million and $70 million in connection with the 2020 Program. These charges, the majority of which will result in cash outlays, including severance and other employee costs, will be incurred as the specific actions required to execute these initiatives are identified and approved and are expected to be substantially completed by the end of fiscal 2023. During the three and six months ended September 26, 2020, the Company incurred $4.4 million and $8.0 million, respectively, of restructuring and turnaround costs under this program. During both the three and six months ended September 28, 2019, the Company incurred $2.9 million of restructuring and turnaround costs under this program. Total cumulative charges under this program are $19.8 million.

During fiscal 2018, the Company launched a Complexity Reduction Initiative (the "2018 Program"), a company-wide restructuring program designed to improve operational performance and reduce cost, freeing up resources to invest in accelerated growth. During the three months ended September 26, 2020, the Company incurred minimal charges of restructuring and turnaround costs under this program. During the six months ended September 26, 2020, the Company incurred $0.5 million of restructuring and turnaround costs under this program. During the three and six months ended September 28, 2019, the Company incurred $0.9 million and $2.9 million, respectively, of restructuring and turnaround costs under this program. Total cumulative charges under this program are $58.7 million. The 2018 Program is substantially complete.

The following table summarizes the activity for restructuring reserves related to the 2020 Program and the 2018 Program and prior programs for the six months ended September 26, 2020, substantially all of which relates to employee severance and other employee costs:
(In thousands)2020 Program2018 Program and Prior ProgramsTotal
Balance at March 28, 2020$1,136 $1,512 $2,648 
Costs incurred, net of reversals1,100 (108)992 
Payments(1,145)(815)(1,960)
Balance at September 26, 2020$1,091 $589 $1,680 

The following presents the restructuring costs by line item within our accompanying unaudited condensed consolidated statements of income and comprehensive income:
 Three Months EndedSix Months Ended
(In thousands) September 26,
2020
September 28,
2019
September 26,
2020
September 28,
2019
Cost of goods sold$(236)$283 $267 $442 
Research and development(209)555 110 569 
Selling, general and administrative expenses372 505 615 1,301 
$(73)$1,343 $992 $2,312 

As of September 26, 2020, the Company had a restructuring liability of $1.7 million, of which $1.2 million is payable within the next twelve months.

In addition to the restructuring costs included in the table above, the Company also incurred costs that do not constitute restructuring under ASC 420, Exit and Disposal Cost Obligations, and which the Company instead refers to as turnaround costs. These costs consist primarily of expenditures directly related to the restructuring actions and include program management costs associated with the 2020 Program and operational performance improvement initiatives.
The tables below present restructuring and turnaround costs by reportable segment:
Restructuring costsThree Months EndedSix Months Ended
(In thousands) September 26, 2020September 28, 2019September 26, 2020September 28, 2019
Plasma$(87)$395 $481 $548 
Blood Center20 94 174 136 
Hospital(147)34 (18)237 
Corporate141 820 355 1,391 
Total$(73)$1,343 $992 $2,312 
Turnaround costsThree Months EndedSix Months Ended
(In thousands) September 26, 2020September 28, 2019September 26, 2020September 28, 2019
Plasma$804 $31 $804 $79 
Blood Center490 — 506 — 
Hospital— 10 — 
Corporate3,218 2,383 6,128 3,393 
Total$4,513 $2,414 $7,448 $3,472 
Total restructuring and turnaround costs$4,440 $3,757 $8,440 $5,784