Quarterly report pursuant to Section 13 or 15(d)

RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS

v3.10.0.1
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS
 9 Months Ended
Sep. 30, 2018
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS  
RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS

7. RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS

 

As of September 30, 2018 and December 31, 2017, accrued restructuring costs of continuing operations by type of cost and initiative consisted of the following (dollars in millions):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-cancelable

 

Other

 

 

 

 

Workforce

 

Demolition and

 

lease and contract

 

restructuring

 

 

 

    

reductions(1)

    

decommissioning

    

termination costs

    

costs

    

Total(2)

Accrued liabilities as of January 1, 2018

 

$

 5

 

$

 2

 

$

41

 

$

 5

 

$

53

2018 charges (credits) for 2017 and prior initiatives

 

 

 1

 

 

 —

 

 

 1

 

 

(3)

 

 

(1)

2018 charges for 2018 initiatives

 

 

 —

 

 

 —

 

 

 —

 

 

 7

 

 

 7

2018 (payments) credits for 2017 and prior initiatives

 

 

(3)

 

 

(1)

 

 

(1)

 

 

 3

 

 

(2)

2018 payments for 2018 initiatives

 

 

 —

 

 

 —

 

 

 —

 

 

(5)

 

 

(5)

Foreign currency effect on liability balance

 

 

 —

 

 

 —

 

 

 1

 

 

 —

 

 

 1

Accrued liabilities as of September 30, 2018

 

$

 3

 

$

 1

 

$

42

 

$

 7

 

$

53

(1)

The workforce reduction reserves relate to the termination of 52 positions, of which 9 positions had not been terminated as of September 30, 2018.

 

(2)

Accrued liabilities by initiatives were as follows (dollars in millions):

 

 

 

 

 

 

 

 

 

 

September 30,

 

December 31,

 

    

2018

    

2017

2016 and prior initiatives

 

$

49

 

$

51

2017 initiatives

 

 

 2

 

 

 2

2018 initiatives

 

 

 2

 

 

 —

Total

 

$

53

 

$

53

 

Details with respect to our reserves for restructuring, impairment and plant closing costs by segment and initiative are provided below (dollars in millions):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performance

 

Advanced

 

Textile

 

Corporate

 

 

 

 

    

Polyurethanes

    

Products

    

Materials

    

Effects

    

and other

    

Total

 

Accrued liabilities as of January 1, 2018

 

$

 1

 

$

 1

 

$

 3

 

$

47

 

$

 1

 

$

53

 

2018 charges (credits) for 2017 and prior initiatives

 

 

 —

 

 

 1

 

 

 —

 

 

(4)

 

 

 2

 

 

(1)

 

2018 charges for 2018 initiatives

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 7

 

 

 7

 

2018 payments for 2017 and prior initiatives

 

 

(1)

 

 

(1)

 

 

 —

 

 

 —

 

 

 —

 

 

(2)

 

2018 payments for 2018 initiatives

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

(5)

 

 

(5)

 

Foreign currency effect on liability balance

 

 

 —

 

 

 —

 

 

 —

 

 

 1

 

 

 —

 

 

 1

 

Accrued liabilities as of September 30, 2018

 

$

 —

 

$

 1

 

$

 3

 

 

44

 

$

 5

 

$

53

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current portion of restructuring reserves

 

$

 —

 

$

 1

 

$

 1

 

$

 3

 

$

 5

 

$

10

 

Long-term portion of restructuring reserves

 

 

 —

 

 

 —

 

 

 2

 

 

41

 

 

 —

 

 

43

 

 

Details with respect to cash and noncash restructuring charges from continuing operations for the three and nine months ended September 30, 2018 and 2017 are provided below (dollars in millions):

 

 

 

 

 

 

 

 

 

    

Three months

 

Nine months

 

 

ended

 

ended

 

 

September 30, 2018

 

September 30, 2018

Cash charges:

 

 

 

 

 

 

2018 charges for 2017 and prior initiatives

 

$

 3

 

$

(1)

2018 charges for 2018 initiatives

 

 

 2

 

 

 7

Noncash charges:

 

 

 

 

 

 

Other noncash charges

 

 

 —

 

 

 2

Total 2018 restructuring, impairment and plant closing costs

 

$

 5

 

$

 8

 

 

 

 

 

 

 

 

 

    

Three months

 

Nine months

 

 

ended

 

ended

 

 

September 30, 2017

 

September 30, 2017

Cash charges:

 

 

 

 

 

 

2017 charges for 2016 and prior initiatives

 

$

 2

 

$

 7

2017 charges for 2017 initiatives

 

 

 —

 

 

 6

Pension-related charges

 

 

 —

 

 

 1

Noncash charges:

 

 

 

 

 

 

Accelerated depreciation

 

 

 —

 

 

 2

Other noncash credits

 

 

(1)

 

 

(3)

Total 2017 restructuring, impairment and plant closing costs

 

$

 1

 

$

13

 

2018 Restructuring Activities

 

In September 2011, we implemented a significant restructuring of our Textile Effects segment (“Textile Effects Restructuring”), including the closure of our production facilities and business support offices in Basel, Switzerland. In connection with this restructuring plan, during the nine months ended September 30, 2018, our Textile Effects segment recorded a credit of $4 million primarily related to a gain on the sale of land at the Basel, Switzerland site.

 

Our Corporate and other segment recorded restructuring expense of $9 million in the nine months ended September 30, 2018 related to corporate initiatives.

 

2017 Restructuring Activities

 

In connection with the Textile Effects Restructuring involving the closure of our production facilities and business support offices in Basel, Switzerland, we recorded restructuring expense of $4 million in the nine months ended September 30, 2017. 

 

During the first quarter of 2017, we implemented the first phase of a restructuring program to improve competitiveness in our Textile Effects segment. In connection with this restructuring program, we recorded restructuring expense of $7 million in the nine months ended September 30, 2017 primarily related to workforce reductions.