2014 coMPared to 2013 Sales Gross Profit Selling, General and Administrative Expenses net sales increased 0.1% to $139.3 million for the year ended December 31, 2014, from net sales of $139.2 million in 2013, primarily due  to increases in sales in the aerospace and defense and medical markets of approximately 10% and 2%, respectively, partially offset by  sales decline in the automotive market of approximately 6%. the increase in sales to the aerospace and defense market was largely  due to an increase in sales of approximately $2.1 million for a low-margin contract manufacturing program. Absent this increase,  sales to the aerospace and defense market declined approximately 6% due primarily to cuts in government spending. the decline in  sales to the automotive market was primarily due to the phase-out of an interior trim program coupled with soft demand for parts for  a specific model of car that has had weak demand from consumers. Gross profit as a percentage of sales (“Gross Margin”) declined to 26.5% for the year ended December 31, 2014, from 29.5% in  2013. As a percentage of sales, material and direct labor collectively increased approximately 1.5% and overhead as a percentage  of sales increased approximately 1.5% or approximately $2 million in 2014. the increase in material and direct labor was a result of  manufacturing inefficiencies incurred as a result of plant moves in the Midwest, California and texas as well as an increase in sales  for a low-margin contract manufacturing military program. the increase in overhead was primarily due to increased employee  health care costs of approximately $600,000 due to a higher than typical frequency of large claims, increased compensation and  benefits of approximately $450,000 due to normal inflationary increases as well as higher overtime incurred as a result of the plant  moves, increased plant and equipment maintenance costs of approximately $290,000 due to the various plant moves and higher  depreciation of approximately $220,000 due largely to new molded fiber equipment. selling, General, and Administrative expenses (“sG&A”) increased 1.0% to $23.8 million for the year ended December 31, 2014 from  $23.6 million in 2013. the increase in sG&A for the year ended December 31, 2014, is primarily due to higher depreciation costs of  $160,000, largely associated with the Company’s new enterprise Resource planning (“eRp”) software system, increased bad debt  expense of approximately $140,000 due largely to a one-time write-off and increased employee health care costs of approximately  $184,000 due largely to a higher than typical frequency of large claims, partially offset by lower sales commissions of approximately  $100,000 due to soft sales compared to the Company’s budgeted sales, lower advertising costs incurred of approximately $70,000  and lower intangibles amortization of approximately $85,000. On January 7, 2014, the Company committed to move forward with a plan to cease operations at its Glendale Heights, Illinois plant  and consolidate operations into its Grand Rapids, Michigan, facility. the Company’s decision was in response to a pending significant  increase in lease cost, declining sales at the Illinois facility, and significant anticipated savings as a result of the consolidation. the  consolidation into the Michigan facility is complete and the actual costs incurred are included in the table below. On July 16, 2014, the Company committed to move forward with a plan to cease operations at its Costa Mesa, California, plant  and consolidate operations into its Rancho Dominguez, California, facility and other UFp facilities. the Company’s decision was in  response to the upcoming December 31, 2014, expiration of the lease on the Costa Mesa facility as well as the close proximity of the  two properties. this consolidation is substantially complete and the actual costs incurred through December 31, 2014 are included in  the table below. Restructuring Costs the Company has recorded the following restructuring costs associated with the plant consolidations discussed above for the year  ended December 31, 2014 (in thousands): these costs were reclassified in the 2014 Consolidated statement of Operations as “Restructuring Costs” as follows: $1,385,000 from  Cost of sales, $82,000 from selling, General and Administrative expenses and $89,000 from Gain on sales of property, plant and  equipment. the Company also incurred approximately $373,000 and $38,000, in related capital improvements at its Michigan and  California facilities, respectively, for the year ended December 31, 2014. restructuring costs  Michigan   california total employee severance payments  $ 237  $ 10  $ 247 Relocation costs  356  501  857 Workforce training costs  373  - 373 plant infrastructure costs  79  - 79 total restructuring costs  $ 1,045  $ 511  $ 1,556 10