Restructuring

2018 Projects

On February 22, 2018, our Board of Directors approved a restructuring plan (2018 Projects). The 2018 Projects will include activities that continue our efforts to optimize our global supply chain and manufacturing operations, product development, and sales and marketing organizations. We expect to substantially complete the plan by the end of 2020. Many of the affected employees are represented by unions or works councils, which require consultation, and potential restructuring projects may be subject to regulatory approval, both of which could impact the timing of charges, total expected charges, cost recognized, and planned savings in certain jurisdictions.

The total expected restructuring costs, the restructuring costs recognized, and the remaining expected restructuring costs related to the 2018 Projects are as follows:



	Total Expected Costs at March 31, 2018		Costs Recognized During the Three Months Ended March 31, 2018		Expected Remaining Costs to be Recognized at March 31, 2018
	(in thousands)
Employee severance costs	$	87,993	$	87,993	$	—
Other restructuring costs	16,500		—		16,500
Total	$	104,493	$	87,993	$	16,500

Segments:
Electricity	$	20,706	$	19,206	$	1,500
Gas	51,929		42,929		9,000
Water	23,712		17,712		6,000
Corporate unallocated	8,146		8,146		—
Total	$	104,493	$	87,993	$	16,500

2016 Projects

On September 1, 2016, we announced projects (2016 Projects) to restructure various company activities in order to improve operational efficiencies, reduce expenses and improve competiveness. We expect to close or consolidate several facilities and reduce our global workforce as a result of the restructuring. The 2016 Projects began during the three months ended September 30, 2016, and we expect to substantially complete the 2016 Projects by the end of 2018.

The total expected restructuring costs, the restructuring costs recognized, and the remaining expected restructuring costs related to the 2016 Projects are as follows:



	Total Expected Costs at March 31, 2018		Costs Recognized in Prior Periods		Costs Recognized During the Three Months Ended March 31, 2018			Expected Remaining Costs to be Recognized at March 31, 2018
	(in thousands)
Employee severance costs	$	38,848	$	39,855	$	(1,007	)	$	—
Asset impairments & net loss on sale or disposal	4,969		4,922		47			—
Other restructuring costs	15,767		9,435		832			5,500
Total	$	59,584	$	54,212	$	(128	)	$	5,500

Segments:
Electricity	$	10,919	$	9,025	$	394		$	1,500
Gas	31,799		29,181		618			2,000
Water	14,763		13,761		(998		)	2,000
Corporate unallocated	2,103		2,245		(142		)	—
Total	$	59,584	$	54,212	$	(128	)	$	5,500

The following table summarizes the activity within the restructuring related balance sheet accounts for the 2018 and 2016 Projects during the three months ended March 31, 2018:



	Accrued Employee Severance			Asset Impairments & Net Loss on Sale or Disposal			Other Accrued Costs			Total
	(in thousands)
Beginning balance, January 1, 2018	$	37,654		$	—		$	2,471		$	40,125
Costs charged to expense	86,986			47			832			87,865
Cash payments	(7,063		)	—			(854		)	(7,917		)
Net assets disposed and impaired	—			(47		)	—			(47		)
Effect of change in exchange rates	1,566			—			2			1,568
Ending balance, March 31, 2018	$	119,143		$	—		$	2,451		$	121,594

Asset impairments are determined at the asset group level. Revenues and net operating income from the activities we have exited or will exit under the restructuring projects are not material to our operating segments or consolidated results.

Other restructuring costs include expenses for employee relocation, professional fees associated with employee severance, and costs to exit the facilities once the operations in those facilities have ceased. Costs associated with restructuring activities are generally presented in the Consolidated Statements of Operations as restructuring, except for certain costs associated with inventory write-downs, which are classified within cost of revenues, and accelerated depreciation expense, which is recognized according to the use of the asset.

The current portion of restructuring liabilities were $60.3 million and $32.5 million as of March 31, 2018 and December 31, 2017. The current portion of restructuring liabilities are classified within other current liabilities on the Consolidated Balance Sheets. The long-term portion of restructuring liabilities balances were $61.2 million and $7.6 million as of March 31, 2018 and December 31, 2017. The long-term portion of restructuring liabilities are classified within other long-term obligations on the Consolidated Balance Sheets, and include facility exit costs and severance accruals.