Restructuring Actions

In fiscal 2012, the Company announced plans to reduce manufacturing capacity through closure of its Newbern, Tennessee and Ostrava, Czech Republic plants, as well as the consolidation of its plants in Poplar Bluff, Missouri and Auburn, Alabama. During fiscal 2012, the Company ceased manufacturing operations at its Newbern, Tennessee and Ostrava, Czech Republic plants, and carried out the consolidation of the Poplar Bluff, Missouri plant. Production of horizontal shaft engines was concluded at the Auburn, Alabama plant during the second quarter of fiscal 2014. The Company also announced in fiscal 2012 the reduction of approximately 10% of the Company's salaried headcount. In fiscal 2012 and fiscal 2013, the Company implemented the salaried headcount reductions. Additionally, beginning in fiscal 2013, the Company exited the placement of lawn and garden products at national mass retailers. The Engines Segment continues to support lawn and garden equipment OEMs who provide lawn and garden equipment to these retailers. Workforce reductions associated with the Company's restructuring initiatives impacted approximately 1,250 regular and temporary employees globally.

In October 2012, the Board of Directors of the Company authorized an amendment to the Company's defined benefit retirement plans for U.S., non-bargaining employees. The amendment freezes accruals for all non-bargaining employees effective January 1, 2014. The Company recorded a pre-tax curtailment charge of $1.9 million in the second quarter of fiscal 2013 related to the defined benefit plan change.

In the first quarter of fiscal 2013, the Company completed the sale of its dormant manufacturing facility in Jefferson, Wisconsin and a land parcel adjacent to its Ostrava, Czech Republic plant. In the fourth quarter of fiscal 2013, the Company completed the sale of the Ostrava, Czech Republic facility.

The Company reports restructuring charges associated with manufacturing and related initiatives as costs of goods sold within the Condensed Consolidated Statements of Operations. Restructuring charges reflected as costs of goods sold include, but are not limited to, termination and related costs associated with manufacturing employees, asset impairments and accelerated depreciation relating to manufacturing initiatives, and other costs directly related to the restructuring initiatives implemented. The Company reports all other non-manufacturing related restructuring charges as engineering, selling, general and administrative expenses on the Condensed Consolidated Statements of Operations.

The restructuring actions for the third quarter of fiscal 2014 resulted in pre-tax income of $0.8 million ($0.5 million after tax or $0.01 per diluted share) related to the reduction of an estimated reserve related to plant closure costs. The Company recorded pre-tax charges of $5.1 million ($3.9 million after tax or $0.08 per diluted share) during the nine months ended March 30, 2014 related to the restructuring actions discussed above. The Engines Segment recorded pre-tax income of $0.8 million and pre-tax charges of $3.0 million during the third quarter and first nine months of fiscal 2014, respectively. The Products Segment recorded no pre-tax restructuring charges during the third quarter and $2.1 million of pre-tax restructuring charges during the first nine months of fiscal 2014.

The following is a rollforward of the restructuring reserve (included in Accrued Liabilities within the Condensed Consolidated Balance Sheets) attributable to all Engines Segment restructuring activities for the nine month period ended March 30, 2014 (in thousands):



	Termination Benefits			Other Costs			Total
Reserve Balance at June 30, 2013	$	99		$	2,575		$	2,674
Provisions	348			2,699			3,047
Cash Expenditures	(447		)	(3,233		)	(3,680		)
Other Adjustments⁽¹⁾	—			(2,041		)	(2,041		)
Reserve Balance at March 30, 2014	$	—		$	—		$	—

(1)Other adjustments includes $0.5 million of accelerated depreciation and $1.5 million of asset impairments.

The following is a rollforward of the restructuring reserve (included in Accrued Liabilities within the Condensed Consolidated Balance Sheets) attributable to all Products Segment restructuring activities for the nine month period ended March 30, 2014 (in thousands):



	Termination Benefits			Other Costs			Total
Reserve Balance at June 30, 2013	$	94		$	45		$	139
Provisions	256			1,826			2,082
Cash Expenditures	(229		)	(325		)	(554		)
Other Adjustments⁽²⁾	—			(1,546		)	(1,546		)
Reserve Balance at March 30, 2014	$	121		$	—		$	121

(2) Other adjustments includes $1.5 million of asset impairments.