RESTRUCTURING AND ASSET IMPAIRMENTS

DynaEnergetics

During the fourth quarter of 2019, regional shifts in North American drilling and completion activity led DynaEnergetics to close distribution facilities in Canada and Oklahoma and to accelerate a planned consolidation of its perforating system assembly operations in Mt. Braddock, Pennsylvania into its flagship North American facility in Blum, Texas.

During the third quarter of 2019, DynaEnergetics completed a series of capacity expansion initiatives at its manufacturing facilities in North America and Germany. The new capacity improved DynaEnergetics’ operating efficiencies and enabled the business to more effectively serve its global customer base. Capitalizing on its more efficient manufacturing footprint, DynaEnergetics ceased its operations in Tyumen, Siberia in September 2019. During the third and fourth quarters of 2019, the Company released substantially all of its employees inside Russia, sold inventories and certain fixed assets, and proceeded to wind-down the operation. The Company will not resume operations in Russia.

During the third and fourth quarters of 2019, DynaEnergetics recorded non-cash asset impairment charges of $6,231, which was calculated by comparing the estimated fair value less costs to sell to the carrying value of the assets, severance charges of $1,261, and other exit costs of $268 within “Restructuring expenses, net and asset impairments.” Additionally, DynaEnergetics recorded a non-cash inventory write down of $630 within “Cost of products sold” and an accounts receivable write down of $131 within "Selling and distribution expenses" associated with the decision to cease operations in Siberia.

During the fourth quarter of 2019, the Company substantially liquidated the assets and liabilities of DynaEnergetics' Siberian operations, as defined under U.S. GAAP. As a result, the related cumulative foreign currency translation loss of $10,420 was reclassified from the Consolidated Balance Sheets into the Consolidated Statement of Operations and is included within “Restructuring expenses, net and asset impairments.” During 2020, the Company anticipates selling or transferring its remaining fixed assets, collecting outstanding accounts receivable, making final severance payments, and commencing the process to legally dissolve the entity, which is expected to be completed by the end of 2021. As of December 31, 2019, total DynaEnergetics Siberia’s assets classified as held for sale was $734.

In 2017, DynaEnergetics announced the closure of its operations in Kazakhstan after legislative changes increased our costs to do business while the overall sales in Kazakhstan were not significant to our results. In conjunction with the announcement, we recorded severance expense, wrote off remaining receivables, prepaid assets, and inventory, recorded an asset impairment to reduce the fixed assets to their salable value, and recorded within the Consolidated Statements of Operations foreign exchange losses that had previously been recorded within the Consolidated Balance Sheets through currency translation adjustments, due to the substantial liquidation of the entity.

NobelClad

During the fourth quarter of 2017, NobelClad announced plans to consolidate its European production facilities by closing manufacturing operations in France. During the third quarter of 2018, final approval of the proposed measures was granted by the local workers council, in accordance with applicable French law. NobelClad completed the closure of the Rivesaltes production facility in the fourth quarter of 2018 but maintains its sales and administrative office in France. During the second quarter of 2019, NobelClad sold its production facility and related assets and recognized a gain of $519. During 2019 NobelClad also recorded an additional accrual of $1,166 for known and probable severance liabilities related to employees terminated as part of closing the manufacturing operations in France. The additional severance accrual was recorded based, in part, on a successful appeal of severance benefits by some terminated employees during the second quarter of 2019.

Total restructuring charges incurred for these programs are as follows and are reported in the "Restructuring expenses, net and asset impairments" line item in our Consolidated Statements of Operations for the years ended December 31:



	2019
	Severance		Asset Impairment / (Gain on asset disposals)			Contract Termination Costs		Equipment Moving Costs		Other Exit Costs (1)		Total
DynaEnergetics	$	1,671	$	6,277		$	—	$	—	$	10,683	$	18,631
NobelClad	1,166		(636		)	39		233		70		872
Total	$	2,837	$	5,641		$	39	$	233	$	10,753	$	19,503

(1) Other exit costs include DynaEnergetics Siberia's cumulative translation losses reclassified into the Consolidated Statement of Operations upon substantial liquidation



	2018
	Severance		Contract Termination Costs		Equipment Moving Costs		Other Exit Costs		Total
NobelClad	$	637	$	43	$	249	$	185	$	1,114



	2017
	Severance		Asset Impairment		Other Exit Costs		Total
DynaEnergetics	$	20	$	143	$	295	$	458
NobelClad	2,513		$	1,241	71		3,825
Total	$	2,533	$	1,384	$	366	$	4,283

The changes to the restructuring liability within accrued expenses associated with these programs is summarized below:



	December 31, 2018		Expense		Payments			Currency and Other Adjustments		December 31, 2019
Severance	$	1,105	$	2,402	$	(1,131	)	$	28	$	2,404
Contract termination costs	—		39		(39		)	—		—
Equipment moving costs	8		233		(241		)	—		—
Other exit costs	42		333		(114		)	10		271
Total	$	1,155	$	3,007	$	(1,525	)	$	38	$	2,675