Restructuring And Impairment Costs

6 Months Ended

Sep. 30, 2012

RESTRUCTURING AND IMPAIRMENT COSTS

Since the beginning of fiscal year 2011, Universal has recorded approximately $37 million of restructuring and impairment costs related to various initiatives to adjust operations and reduce costs. Approximately $12 million of those costs related to the closing of the Company’s leaf tobacco processing facility in Canada. The remaining amounts were associated with various other cost reduction initiatives, including voluntary early retirement offers and involuntary separations at the Company’s headquarters and operating locations in the United States, South America, Africa, Europe, and Asia, as well as costs related to the termination of a business arrangement with a supplier and processor of tobacco in Europe in response to market changes. The restructuring and impairment costs primarily related to operating subsidiaries that are part of the North America and Other Regions reportable segments.

A summary of the restructuring costs recorded during the six months ended September 30, 2012 and 2011, is as follows:



(in thousands of dollars)	Six Months Ended September 30, 2012		Six Months Ended September 30, 2011

Employee termination benefits	$	3,687	$	6,724
Other restructuring costs	—		3,097
Total	$	3,687	$	9,821

A reconciliation of the Company’s liability for the employee termination benefits and other restructuring costs discussed above for the six months ended September 30, 2012 and 2011, is as follows:



(in thousands of dollars)	Employee Termination Benefits			Other Costs			Total

Six Months Ended September 30, 2011:
Balance at beginning of year	$	6,386		$	225		$	6,611
Costs charged to expense	6,724			3,097			9,821
Payments	(10,914		)	(37		)	(10,951		)
Balance at September 30, 2011	$	2,196		$	3,285		$	5,481

Six Months Ended September 30, 2012:
Balance at beginning of year	$	1,271		$	291		$	1,562
Costs charged to expense	3,687			—			3,687
Payments	(4,766		)	(253		)	(5,019		)
Balance at September 30, 2012	$	192		$	38		$	230

Most of the restructuring liability remaining at September 30, 2012 is expected to be paid by the end of the current fiscal year. Universal continually reviews its business for opportunities to realize efficiencies, reduce costs, and realign its operations in response to business changes. The Company may incur additional restructuring costs and asset impairment charges in future periods as business changes occur and additional cost savings initiatives are implemented.

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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