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Restructuring and impairment (credits) charges
 9 Months Ended
Sep. 27, 2020
Restructuring and Related Activities [Abstract]  
Restructuring and impairment (credits) charges Restructuring and impairment (credits) charges
2020 Workforce reduction plan
During the second quarter of 2020, we committed to a workforce reduction designed to improve profitability and reduce cost primarily by streamlining certain sales and marketing functions in our EMEA segment and certain manufacturing operations in our OEM segment. The workforce reduction was initiated to further align the business with our high growth strategic objectives. We estimate that we will incur aggregate pre-tax restructuring charges of $10 million to $13 million, consisting primarily of termination benefits, all of which will result in future cash outlays. This program will be substantially complete during 2020 and as a result most of these charges are expected to be incurred prior to the end of 2020.
Footprint realignment plans
We have ongoing restructuring programs primarily related to the relocation of manufacturing operations to existing lower-cost locations and related workforce reductions (referred to as the 2019, 2018 and 2014 Footprint realignment plans). The following tables provide a summary of our cost estimates and other information associated with these ongoing Footprint realignment plans:
2019 Footprint realignment plan (3)
2018 Footprint realignment plan
2014 Footprint realignment plan (4)
Program expense estimates:(Dollars in millions)
Termination benefits
$16 to $20
$60 to $70
$12 to $13
Other costs (1)
2 to 2
2 to 4
1 to 2
Restructuring charges
18 to 22
62 to 74
13 to 15
Restructuring related charges (2)
40 to 45
40 to 59
38 to 40
Total restructuring and restructuring related charges
$58 to $67
$102 to $133
$51 to $55
Other program estimates:
Expected cash outlays
$55 to $63
$99 to $127
$42 to $46
Expected capital expenditures
$27 to $33
$19 to $23
$25 to $26
Other program information:
Period initiatedFebruary 2019May 2018April 2014
Estimated period of substantial completion2022
2022 (5)
2022
Aggregate restructuring charges$14.6$59.1$13.5
Restructuring reserve:
Balance as of September 27, 2020$7.9$47.2$3.7
Restructuring related charges incurred:
Three Months Ended September 27, 2020$4.3$3.3$1.0
Nine Months Ended September 27, 2020$10.7$6.0$2.7
Aggregate restructuring related charges$17.3$13.2$35.0
(1)Includes facility closure, employee relocation, equipment relocation and outplacement costs.
(2)Restructuring related charges represent costs that are directly related to the programs and principally constitute costs to transfer manufacturing operations to the existing lower-cost locations, project management costs and accelerated depreciation. The 2018 Footprint realignment plan also includes a charge associated with our exit from the facilities that is expected to be imposed by the taxing authority in the affected jurisdiction. Excluding this tax charge, substantially all of the restructuring related charges are expected to be recognized within cost of goods sold.
(3)During the second quarter of 2020, we refined the disclosed ranges for the program expense and other program estimates in consideration of the progress made to date as well as the actions remaining.
(4)During the second quarter of 2020, we delayed the timing of substantial completion from our prior estimate of 2021 due to an extension in the development and qualification timeline, identified during the second quarter of 2020, for a component to be included in certain of our kits sold by our anesthesia business in North America. The shift in timing also resulted in an increase in the total program cost estimate and related cash outlays and as a result, we increased the high end of the ranges by $3 million. With respect to capital expenditures, we have also refined the range.
(5)We accelerated the timing of substantial completion from our prior estimate of 2024 to take advantage of an opportunity we identified during the second quarter of 2020 to accelerate the recognition of estimated savings.
Three Months Ended September 27, 2020
Termination benefits
Other costs (1)
Total
(Dollars in thousands)
2020 Workforce reduction plan$(471)$255 $(216)
2019 Footprint realignment plan(785)368 (417)
2018 Footprint realignment plan(3,006)83 (2,923)
Other restructuring programs (2)
(151)48 (103)
Restructuring (credits) charges$(4,413)$754 $(3,659)
Three Months Ended September 29, 2019
Termination benefits
Other costs (1)
Total
(Dollars in thousands)
2019 Footprint realignment plan$584 $38 $622 
2018 Footprint realignment plan315 74 389 
Other restructuring programs (3)
7 250 257 
Restructuring charges$906 $362 $1,268 

Nine Months Ended September 27, 2020
Termination benefits
Other costs (1)
Total
(Dollars in thousands)
2020 Workforce reduction plan$10,093 $255 $10,348 
2019 Footprint realignment plan367 459 826 
2018 Footprint realignment plan4,853 216 5,069 
Other restructuring programs (2)
(89)538 449 
Restructuring charges$15,224 $1,468 $16,692 

Nine Months Ended September 29, 2019
Termination benefits
Other costs (1)
Total
(Dollars in thousands)
2019 Footprint realignment plan$13,100 $68 $13,168 
2018 Footprint realignment plan(1,523)782 (741)
Other restructuring programs (3)
195 815 1,010 
Restructuring charges11,772 1,665 13,437 
Asset impairment charges— 6,911 6,911 
Restructuring and impairment charges$11,772 $8,576 $20,348 
(1) Other costs include facility closure, contract termination and other exit costs.
(2) Includes the program initiated during third quarter of 2019 as well as the 2016 and 2014 Footprint realignment plans.
(3) Includes the program initiated during third quarter of 2019, the Vascular Solutions integration program (initiated in 2017) as well as the 2016 and 2014 Footprint realignment plans.