Current Report Filing (8-k)
June 18 2020 - 4:37PM
Edgar (US Regulatory)
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0000217346
2020-06-18
2020-06-18
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT
REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event
reported): June 18, 2020
TEXTRON INC.
(Exact name of Registrant as specified
in its charter)
Delaware
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1-5480
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05-0315468
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(State of Incorporation)
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(Commission File Number)
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(IRS Employer Identification Number)
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40 Westminster Street, Providence, Rhode
Island 02903
(Address of principal executive offices)
Registrant’s telephone number,
including area code: (401) 421-2800
Check the appropriate box below if the Form 8-K filing is
intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions
A.2. below):
☐ Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c))
under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b)
of the Act:
Title of each class
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Trading Symbol(s)
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Name of exchange on which registered
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Common Stock – par value $0.125
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TXT
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New York Stock Exchange
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Indicate by check mark whether the
registrant is an emerging growth company as defined in Rule 405 of
the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities
Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if
the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.05 Costs Associated with Exit or Disposal Activities.
Item 2.06 Material Impairments.
On June 18, 2020, the Board of Directors of
Textron Inc. approved a restructuring plan to reduce the Company’s operating expenses through headcount reductions, facility
consolidations and other actions in response to the economic challenges and uncertainty resulting from the COVID-19 pandemic. The
restructuring plan primarily impacts the TRU Simulation + Training business (TRU) within the Textron Systems segment, and the Textron
Aviation and Industrial segments.
At TRU, there has been a substantial decline
in demand and order cancellations for flight simulators in light of the expected long-term impact of the pandemic on the commercial
air transportation business. Accordingly, TRU will cease manufacturing at its Montreal, Canada facility, resulting in the production
suspension of its commercial air transport simulators. As a result, we will incur charges for severance, contract terminations,
facility closures, asset impairments and an inventory valuation write-down, considering the current market conditions. TRU will
continue to service and support its installed base of commercial air transport simulators and to manufacture flight simulators
for other fixed wing aircraft and rotorcraft at its Tampa, Florida facility.
In the Textron Aviation segment, with lower
volumes expected in the near term, we will initiate indirect and direct workforce reductions as we align our cost structure and
production levels with demand. In the Industrial segment, the impact of the pandemic on global air travel has significantly reduced
demand for the airport ground support equipment produced by the Textron Specialized Vehicles (TSV) business. Due to the overall
negative impact of the pandemic on this business, we will take further actions to streamline operations across TSV, consisting
primarily of headcount reductions and facility rationalizations, to reduce its overall cost structure.
In the second quarter of 2020, we expect to
incur pre-tax special charges related to this restructuring plan in the range of $110 million to $130 million. Severance and related
costs for this plan are estimated to be in the range of $60 million to $70 million. Asset impairment charges, which are largely
related to facility closures, are estimated to be in the range of $30 million to $35 million, and contract termination and other
facility closure charges are estimated to be in the range of $20 million to $25 million. The restructuring plan will result in
the elimination of up to 1,950 positions, representing 6% of our workforce. Additionally, we will record a non-cash inventory valuation
charge in the range of $50 million to $60 million.
Cash outflows will occur in 2020 and are estimated
to be in the range of $80 million to $95 million. We anticipate that this plan will be substantially completed by the end of 2020.
Item 8.01 Other Events
During the second quarter of 2020, due to the temporary idling of
manufacturing facilities as a result of the COVID-19 pandemic, we expect to incur idle facility costs in the range of $70 million
to $80 million, principally in the Textron Aviation segment. In June, manufacturing operations have largely resumed across the
company at these facilities as restrictions have been lifted.
SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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TEXTRON INC.
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(Registrant)
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By:
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/s/ Mark S. Bamford
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Mark S. Bamford
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Vice President and Corporate Controller
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Date: June 18, 2020
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