Restructuring Charges

12 Months Ended

Dec. 31, 2014

Restructuring and Other Charges [Abstract]

Note 3. Restructuring Charges

During 2014, the Company initiated a restructuring program and undertook actions to realign its business operations, improve efficiencies, profitability, and return on invested capital. This restructuring will occur across all business segments of the Company and is estimated to provide annualized savings of approximately $20 million. This restructuring resulted in following charges relating to asset impairment and reduction in workforce:

Asset impairment charges:

The asset impairment charges relate to the consolidation of certain manufacturing operations and administrative offices. The Company will close three Construction Technologies’ operations – two in Europe and one in Asia – and consolidate these operations into others in these regions. The Company will also close and consolidate the operations of one of the Performance Materials blending facilities in the U.S. The fair value of the associated assets was estimated using a discounted cash flow approach (a Level 3 fair value input).

The Company also recognized impairment charges for certain underutilized coiled tubing equipment within Energy Services segment which have been abandoned by the Company.

Work force reduction:

During 2014, the Company announced a 10% permanent reduction of its workforce. The reductions, which will occur over the next twelve months, will include elimination of duplicate corporate functions, deployment of our shared service model, and consolidation and alignment of various corporate functions and regional locations across the Company.

The following table outlines the amount of restructuring charges recorded within the Consolidated Statements of Income, and the segments they relate to:

Restructuring and Other Charges	Year Ended December 31, 2014
	(millions of dollars)
Impairment of assets
Performance Materials	$	0.4
Construction Technologies		11.7
Energy Services		11.6
Total impairment of assets charges	$	23.7

Severance and other employee costs
Specialty Minerals	$	3.0
Refractories		0.7
Performance Materials		5.6
Construction Technologies		5.8
Energy Services		3.7
Total severance and other employee costs	$	18.8

Other
Performance Materials	$	0.7

Total restructuring and other charges	$	43.2

At December 31, 2014, we had $14.6 million included within Other current liabilities within our Consolidated Balance Sheets for cash expenditures needed to satisfy remaining obligations under these reorganization initiatives. The Company expects to pay these amounts by the end of December 2015.

The following table is a reconciliation of our restructuring liability balance:

	(millions of dollars)
Restructuring liability, December 31, 2013	$	-
Additional provisions		18.8
Cash payments		(4.2	)
Restructuring liability, December 31, 2014	$	14.6

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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