Restructuring

9 Months Ended

Oct. 02, 2011

Restructuring

Restructuring

Note 16. Restructuring

On May 3, 2011, we committed to a business restructuring plan intended to reduce our operating cost structure over the remainder of 2011. These reductions are intended primarily to improve our services cost structure and margins. Under the business restructuring plan, we will reduce our non-U.S. work force in our service depot and support operations, which represent approximately 2% of our current total global work force. We implemented this restructuring plan in the second quarter of 2011 and expect to complete it over the remainder of fiscal year 2011.

The total restructuring costs for this plan are expected to be $5.9 million, including employee termination costs of $5.1 million and $0.8 million of other associated costs. We recorded $0.6 and $5.8 million of these charges in the three and nine months ended October 2, 2011, respectively. We expect to record the remaining charge in the fourth quarter of 2011. We anticipate that substantially all of the severance-related and periodic other associated costs will be cash expenditures. These costs are recorded on our condensed consolidated statement of operations in restructuring charges.

We expect restructuring costs of $5.4 million to be recorded against the Intermec- branded service reportable segment with the remaining $0.5 million in other costs that cannot be directly allocated to a specific segment.

The reconciliation of accrued restructuring charges as of October 2, 2011 is summarized in the table below (in millions):

	Employee Termination Costs per Contract		Accrued Other Costs		Total Accrued Restructuring Charges
Balance at December 31, 2010	$	—	$	—	$	—
Restructuring charges accrued through October 2, 2011		5.4		0.4		5.8
Less: payments made through October 2, 2011		3.3		0.4		3.7
Balance at October 2, 2011	$	2.1	$	—	$	2.1