Note 13 - Restructuring and Asset Impairment Charges

6 Months Ended

Jul. 02, 2017

Notes to Financial Statements

Restructuring and Related Activities Disclosure [Text Block]

NOTE

13

– RESTRUCTURING AND ASSET IMPAIRMENT CHARGES

In the

fourth

quarter of

2016,

the Company committed to a new restructuring plan in its continuing efforts to improve efficiencies and decrease costs across its worldwide operations, and more closely align its operating structure with its business strategy. The plan involves (i) a substantial restructuring of the FLOR business model that includes closure of its headquarters office and most retail FLOR stores, (ii) a reduction of approximately

70

FLOR employees and a number of employees in the commercial carpet tile business, primarily in the Americas and Europe regions, and (iii) the write-down of certain underutilized and impaired assets that include information technology assets, intellectual property assets, and obsolete manufacturing, office and retail store equipment.

As a result of this plan, the Company incurred a pre-tax restructuring and asset impairment charge in the

fourth

quarter of

2016

of

$19.8

million. In the

first

quarter of

2017,

the Company recorded an additional charge of

$7.3

million, primarily related to exit costs associated with the closure of most FLOR retail stores in the

first

quarter of

2017.

The charge in the

first

quarter of

2017

was comprised of lease exit costs of

$3.4

million, asset impairment charges of

$3.3

million and severance charges of

$0.6

million.

A summary of these restructuring activities is presented below:

	Total Restructuring Charge		Costs Incurred in 2016		Costs Incurred in 2017		Balance at July, 2, 2017
			(in thousands)
Workforce Reduction	$	10,652	$	1,451	$	5,631	$	3,570
Asset Impairment		11,319		8,019		3,300		0
Lease Exit Costs		5,116		27		4,122		967