Dover announced a rightsizing plan designed to increase operating margin, enhance operations and position the Company for sustained growth and investment.
The plan is primarily comprised of broad-based SG&A reduction initiatives which will position the Company for meaningful operating margin expansion. The Company expects the program to deliver $130 million of annualized pre-tax earnings by year-end 2019, of which $30 million will be reinvested in high-return growth initiatives. The program will not affect the Company's research and development activities.
The one-time pre-tax costs to implement the program are estimated to be $40 million, with approximately $30 million of the costs to be recorded in the second half of 2018, and the remaining $10 million to be recorded in the first half of 2019. The costs associated with the program will be excluded from Dover's reported adjusted earnings and adjusted diluted earnings per share from continuing operations, both of which are non-GAAP measures. PW0918