Quarterly report pursuant to Section 13 or 15(d)

Restructuring Activities

v3.24.2
Restructuring Activities
6 Months Ended
Jun. 30, 2024
Restructuring and Related Activities [Abstract]  
Restructuring Activities

13. Restructuring Activities

In 2021, the Company initiated a global transformation program to optimize global processes for future growth, or the Transformation Program. The Transformation Program involves the investment in certain new technologies and the realignment of infrastructure and the locations of certain functions to better support distributors and customers. The Company has incurred total pre-tax expenses of approximately $88.6 million through June 30, 2024, of which $3.5 million and $10.1 million for the three months ended June 30, 2024 and 2023, respectively, and $9.4 million and $37.4 million for the six months ended June 30, 2024 and 2023, respectively, were recognized in selling, general, and administrative expenses within its condensed consolidated statements of income. The Company expects to incur total pre-tax expenses of approximately $90 million relating to the Transformation Program based on actual expenses incurred to date and expected future expenses. The Transformation Program is expected to be completed in 2024.

Costs related to the Transformation Program were as follows:

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

 

 

 

June 30,
2024

 

 

June 30,
2023

 

 

June 30,
2024

 

 

June 30,
2023

 

 

Cumulative costs incurred
to date as of June 30, 2024

 

 

 

(in millions)

 

Professional fees

 

$

0.6

 

 

$

2.0

 

 

$

1.5

 

 

$

4.1

 

 

$

26.4

 

Retention and separation

 

 

2.9

 

 

 

7.9

 

 

 

7.8

 

 

 

33.1

 

 

 

61.3

 

Other

 

 

 

 

 

0.2

 

 

 

0.1

 

 

 

0.2

 

 

 

0.9

 

Total

 

$

3.5

 

 

$

10.1

 

 

$

9.4

 

 

$

37.4

 

 

$

88.6

 

 

 

Changes in the liabilities related to the Transformation Program, which were recognized in other current liabilities within the Company’s condensed consolidated balance sheets, were as follows:

 

 

 

Professional
Fees

 

 

Retention and
Separation

 

 

Other

 

 

Total

 

 

 

(in millions)

 

Balance as of December 31, 2023

 

$

1.0

 

 

$

8.2

 

 

$

 

 

$

9.2

 

Expenses

 

 

1.5

 

 

 

7.8

 

 

 

0.1

 

 

 

9.4

 

Cash payments

 

 

(2.2

)

 

 

(7.9

)

 

 

(0.1

)

 

 

(10.2

)

Non-cash items and other

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of June 30, 2024

 

$

0.3

 

 

$

8.1

 

 

$

 

 

$

8.4

 

 

During the first quarter of 2024, the Company initiated an organizational redesign project, or the Restructuring Program, to streamline its organizational structure to make it more efficient and effective and to allow the Company’s management team to work more closely with the markets, its distributors, and its customers. The Company has incurred total pre-tax expenses of approximately $65.5 million through June 30, 2024, of which $48.8 million and $65.5 million for the three and six months ended June 30, 2024, respectively, were recognized in selling, general, and administrative expenses within its condensed consolidated statements of income. The Company expects to incur total pre-tax expenses of approximately $70 million relating to the Restructuring Program based on actual expenses incurred to date and expected future expenses. The Restructuring Program is expected to be completed in 2024. Since the Restructuring Program is still ongoing, these estimated amounts are preliminary and based on management’s estimates and actual results could differ from such estimates.

Costs related to the Restructuring Program were as follows:

 

 

 

Three Months Ended

 

 

 

Six Months Ended

 

 

 

 

 

 

June 30,
2024

 

 

 

June 30,
2024

 

 

Cumulative costs incurred to
date as of June 30, 2024

 

 

 

(in millions)

 

Professional fees

 

$

1.4

 

 

 

$

4.2

 

 

$

4.2

 

Retention and separation

 

 

47.4

 

 

 

 

61.3

 

 

 

61.3

 

Other

 

 

 

 

 

 

 

 

 

 

Total

 

$

48.8

 

 

 

$

65.5

 

 

$

65.5

 

 

Changes in the liabilities related to the Restructuring Program, which were recognized in other current liabilities within the Company’s condensed consolidated balance sheets, were as follows:

 

 

 

Professional
Fees

 

 

Retention and
Separation

 

 

Other

 

 

Total

 

 

 

(in millions)

 

Expenses

 

$

4.2

 

 

$

61.3

 

 

$

 

 

$

65.5

 

Cash payments

 

 

(3.7

)

 

 

(29.0

)

 

 

 

 

 

(32.7

)

Non-cash items and other

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of June 30, 2024

 

$

0.5

 

 

$

32.3

 

 

$

 

 

$

32.8