Termination Benefits and Other Cost Reduction Actions

3 Months Ended

Mar. 31, 2016

Restructuring And Related Activities [Abstract]

Termination Benefits and Other Cost Reduction Actions

10.	Termination Benefits and Other Cost Reduction Actions

The Company undertook certain actions to continue to integrate its acquisitions and implement cost containment measures in an effort to better align operating costs with market and business conditions. Expenses related to these actions that include real estate consolidations, elimination of redundant functions and employees, are summarized below (in thousands):

	For the Three Months Ended March 31,
	2016		2015
Employee severance and related costs	$	2,745	$	2,579
Facilities-related costs		1,385		176
Total	$	4,130	$	2,755

For the three months ended March 31, 2016 and 2015, restructuring costs of $1.5 million and $1.3 million, respectively, have been included in cost of revenues and $2.6 million and $1.4 million, respectively, have been included in SG&A expenses, respectively. The $4.1 million of costs incurred in the three months ended March 31, 2016 includes $1.2 million of costs related to Clinical and $2.9 million related to Commercial. The $2.8 million of costs incurred in the three months ended March 31, 2015 includes $1.0 million of costs related to Clinical, $1.7 million related to Commercial and $0.1 million related to Corporate.

The following table summarizes the Company’s restructuring reserve as of March 31, 2016 and December 31, 2015 (in thousands):

	Balance at							Balance at
	December 31,							March 31,
	2015		Net Costs		Cash Payments			2016
Employee severance and related costs	$	4,245	$	2,745	$	(3,115	)	$	3,875
Facilities-related costs		3,942		1,385		(1,388	)		3,939
Total	$	8,187	$	4,130	$	(4,503	)	$	7,814

The Company expects that severance payments accrued at March 31, 2016 will be paid within the next twelve months. Certain facility costs will be paid over the remaining lease term of the exited facilities through 2027.

The net costs in the table above exclude non-cash charges of approximately $0.2 million for the three months ended March 31, 2016 related to abandoned assets at certain facilities.

INVENTIV HEALTH INC 10-Q