Gain on Sale and Other Costs, Net

9 Months Ended

Sep. 30, 2023

Restructuring and Related Activities [Abstract]

A summary of the items included in gain on sale and other costs, net is as follows:


	Three Months Ended				Nine Months Ended
	September 30,		October 1,		September 30,		October 1,
(In thousands)	2023		2022		2023		2022
Gain on Sale of Assets	$	—	$	—	$	—	$	(20,190)
Relocation Costs	535		—		609		—
Restructuring Costs	398		72		398		72
Impairment Costs	36		—		36		182
	$	969	$	72	$	1,043	$	(19,936)

Gain on Sale of Assets

The Company entered into several agreements with the local government in China to sell the existing manufacturing building and land use rights of one of its subsidiaries in China for $25,159,000 and relocate to a new facility (China Transaction). The agreements became effective in the first quarter of 2022 after a 31% down payment was received, including 25% in 2021 and 6% in the first quarter of 2022, and a land use right in a new location was secured. As a result, the Company recognized a gain on the China Transaction of $20,190,000, or $15,143,000 net of deferred taxes of $5,047,000, in the first quarter of 2022. A receivable of $16,082,000 was recognized for the present value of the remaining amount of the sale proceeds, which is due the earlier of when the government sells the property or within two years from the effective date of the agreements. The subsidiary, which is part of the Industrial Processing segment, relocated to its new facility during the third quarter of 2023.

A summary of the change in the outstanding receivable on the China Transaction is as follows:


(In thousands)	Total
Balance at Inception	$	17,294
Present value discount	(1,212)
Receivable recorded, net	16,082
Accretion of interest income	422
Currency translation	(1,323)
Balance at December 31, 2022 (included in other assets)	15,181
Accretion of interest income	411
Currency translation	(794)
Balance at September 30, 2023 (included in other current assets)	$	14,798

Other Costs

Relocation Costs

As part of the China Transaction, the Company incurred costs of $535,000 in the third quarter of 2023 and $609,000 in the first nine months of 2023 related to the relocation of machinery and equipment and administrative offices to the new manufacturing facility.

Restructuring and Impairment Costs

The Company initiated restructuring plans within its Flow Control segment as follows:

•During the third quarter of 2023, the Company initiated a restructuring plan to consolidate a small manufacturing operation into a larger facility in Germany (2023 Restructuring Plan). The Company recorded total restructuring and impairment charges of $434,000 in the third quarter of 2023 and first nine months of 2023, which consisted of severance costs of $369,000 for the termination of 10 employees, asset-write downs of $36,000, and facility and other closure costs of $29,000.

•During the fourth quarter of 2021, the Company initiated a restructuring plan to eliminate a redundant ceramic blade manufacturing operation in France (2021 Restructuring Plan). The Company recorded additional restructuring costs of $72,000 in the third quarter and first nine months of 2022 related to this plan, which consisted of severance costs for the termination of two employees.

A summary of the changes in accrued restructuring costs included in other current liabilities in the accompanying condensed consolidated balance sheet, which are expected to be paid in the fourth quarter of 2023 and early 2024, are as follows:


(In thousands)	Severance Costs		Facility and Other Closure Costs		Total
2021 Restructuring Plan
Balance at December 31, 2022	$	189	$	200	$	389
Usage	(187)		(199)		(386)
Currency translation	(2)		(1)		(3)
Balance at September 30, 2023	$	—	$	—	$	—

2023 Restructuring Plan
Provision	$	369	$	29	$	398
Usage	(23)		—		(23)
Currency translation	(10)		(1)		(11)
Balance at September 30, 2023	$	336	$	28	$	364

In addition, the Company recorded an impairment charge of $182,000 in the first nine months of 2022 for the write-down of certain fixed assets that were not moved to the new facility related to the China Transaction.