Facility Closures, Consolidations and Sale of Business

12 Months Ended

Dec. 31, 2015

Restructuring and Related Activities [Abstract]

Restructuring and Related Activities Disclosure

Facility Closures, Consolidations and Sale of Business

During 2015, 2014 and 2013, the Company closed and consolidated several facilities, and also sold a business. The majority of the costs to implement the facility actions were incurred within the Company’s Energy reportable segment. See below for details of the most significant actions.

2015 Facility Closures and Consolidations

During 2015, the Company closed and consolidated certain manufacturing facilities, branches, warehouses and sales offices, the largest of which were the closure of the Hangzhou, China, Rio de Janeiro, Brazil and Houston, Texas (former South Texas Bolt and Fitting) manufacturing facilities within the Energy reportable segment.  As a part of the closure and consolidation actions, the Company recorded non-cash charges of approximately $1.4 million, primarily related to write-down of property to its salvage value. As a part of these facility closures and other cost savings actions within the Energy reportable segment, the Company recorded charges of approximately $3.0 million related to severance benefits for its approximately 240 employees that were involuntarily terminated. 

The Company did not fully exit certain of the closed and consolidated facilities during 2015. As such the Company did not record significant unrecoverable lease obligations. The Company will assess the potential recoverability of its future lease obligations for its closed facilities upon the cease-use date, and at that time will record any estimate for unrecoverable amounts, if any.

2014 Facility Closures and Consolidations

In June 2014, the Company announced the restructuring of its Brazilian business within the Energy reportable segment, including plans to close its manufacturing facility in São Paulo, Brazil by the end of 2014. In connection with this action, the Company recorded charges of approximately $0.5 million, primarily related to severance benefits, which is included in cost of sales in the accompanying consolidated statement of operations, for its approximately 60 employees involuntarily terminated as a result of this closure. During the fourth quarter of 2014, upon the cease use date of the facility, the Company recorded a pre-tax charge within in its Energy reportable segment of approximately $3.9 million for estimated future unrecoverable lease obligation, net of estimated sublease recoveries, for the lease agreement that expires in 2022. Additionally, the Company recorded a $1.3 million charge related to the release of historical currency translation adjustments, which is included in dispositions of property and equipment in the accompanying consolidated statement of operations.

During the fourth quarter of 2015, the Company re-evaluated its estimate of unrecoverable future obligations initially recorded for its Brazilian business during 2014 and reduced its estimate by approximately $1.7 million following entry into a sublease agreement for the facility.

2013 Sale of Business

On August 5, 2013, the Company announced the sale of its business in Italy within the Packaging reportable segment for cash of approximately $10.3 million. As a result, the Company recorded a pre-tax gain of approximately $10.5 million, of which $7.9 million related to the release of historical currency translation adjustments into income, which is included in dispositions of property and equipment in the accompanying consolidated statement of operations.