RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS
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Jun. 30, 2014
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RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS |
6. RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS As of June 30, 2014 and December 31, 2013, accrued restructuring costs by type of cost and initiative consisted of the following (dollars in millions):
Details with respect to our reserves for restructuring, impairment and plant closing costs are provided below by segment and initiative (dollars in millions):
Details with respect to cash and noncash restructuring charges for the six months ended June 30, 2014 and 2013 by initiative are provided below (dollars in millions):
2014 RESTRUCTURING ACTIVITIES During 2013, our Performance Products segment initiated a restructuring program to refocus our surfactants business in Europe. In connection with this program, on June 25, 2014 we completed the sale of our European commodity surfactants business, including the ethoxylation facility in Lavera, France to Wilmar. In addition, Wilmar has entered into a multi-year arrangement to purchase certain sulphated surfactant products from our facilities in St. Mihiel, France and Castiglione delle Stiviere, Italy. Additionally, we intend to cease production at our Patrica, Italy surfactants facility by October 2014. During the six months ended June 30, 2014, we recorded charges of $23 million primarily related to workforce reductions, reversed reserves of $1 million that were no longer required and recorded a charge of $1 million for the impairment of long-lived assets relating to the sale of our Lavera, France manufacturing facility to Wilmar. During the six months ended June 30, 2014, our Advanced Materials segment recorded charges of $9 million primarily related to workforce reductions with our global transformational change program designed to improve the segment's manufacturing efficiencies, enhance its commercial excellence and improve its long-term global competitiveness. Our Advanced Materials segment also reversed reserves of $4 million related to this initiative that were no longer required. On September 27, 2011, we announced plans to implement a significant restructuring of our Textile Effects segment, including the closure of our production facilities and business support offices in Basel, Switzerland, as part of an ongoing strategic program aimed at improving the Textile Effects segment's long-term global competitiveness. In connection with this plan, during the six months ended June 30, 2014, our Textile Effects segment recorded charges of $2 million for long-term contract termination costs, $4 million for decommissioning, $1 million for workforce reduction and $1 million in other restructuring costs associated with this initiative. Additionally, we reversed reserves of $2 million related to this initiative that were no longer required. In June 2014, we announced plans for the closure our Qingdao, China plant to be completed by December 2015. During the six months ended June 30, 2014, we recorded charges of $5 million primarily related to workforce reductions related to this initiative. Additionally, we recorded charges of $1 million for long-term contract termination costs and $1 million for workforce reductions for other restructuring initiatives. During the six months ended June 30, 2014, our Corporate and other segment recorded charges of $6 million and reversed reserves of $1 million primarily related to workforce reductions in association with a reorganization of our global information technology organization. Additionally, we recorded charges of $1 million for other restructuring initiatives. 2013 RESTRUCTURING ACTIVITIES During the six months ended June 30, 2013, our Polyurethanes segment recorded charges of $3 million and reversed reserves of $5 million related to workforce reductions in association with our program to reduce annualized fixed costs by approximately $75 million. Our Polyurethanes segment also recorded pension-related settlement charges of $5 million related to this program. During the six months ended June 30, 2013, our Performance Products segment recorded charges of $4 million primarily related to workforce reductions in our Australian operation. During the six months ended June 30, 2013, our Advanced Materials segment recorded charges of $28 million primarily related to workforce reductions with our global transformational change program designed to improve the segment's manufacturing efficiencies, enhance its commercial excellence and improve its long-term global competitiveness. Our Advanced Materials segment also recorded a $1 million noncash charge for asset impairments and reversed reserves of $2 million related to this initiative. On September 27, 2011, we announced plans to implement a significant restructuring of our Textile Effects business, including the closure of our production facilities and business support offices in Basel, Switzerland, as part of an ongoing strategic program aimed at improving the Textile Effects segment's long-term global competitiveness. In connection with this plan, during the six months ended June 30, 2013, our Textile Effects segment recorded charges of $19 million for long-term fixed cost contracts, $8 million for decommissioning, $2 million for other restructuring and $1 million for workforce reduction and reversed reserves of $2 million related to workforce reduction associated with this initiative. During the six months ended June 30, 2013, our Pigments segment recorded charges of $3 million primarily related to the closure of our Grimsby, U.K. plant. During the six months ended June 30, 2013, our Corporate and other segment recorded charges of $8 million primarily related to workforce reductions in association with a reorganization of our global information technology organization. |