Restructuring

3 Months Ended

Aug. 28, 2011

Restructuring [Abstract]

RESTRUCTURING

10. RESTRUCTURING

Administrative Efficiency Restructuring Plan

In August 2011, we made a decision to reorganize our Consumer Foods sales function and certain other administrative functions within our Commercial Foods and Corporate reporting segments. These actions, collectively referred to as the Administrative Efficiency Restructuring Plan (the “Administrative Efficiency Plan”), are intended to improve the efficiency and effectiveness of the affected sales and administrative functions. In connection with the Administrative Efficiency Plan, we expect to incur approximately $21.6 million of charges, primarily for severance and costs of employee relocation. In the first quarter of fiscal 2012, we recognized charges of approximately $11.3 million in relation to the Administrative Efficiency Plan.

We anticipate that we will recognize the following pre-tax expenses associated with the Administrative Efficiency Plan in the fiscal 2012 to 2013 timeframe (amounts include charges recognized in the first quarter of fiscal 2012):

	Consumer		Commercial
	Foods		Foods		Corporate		Total
Accelerated depreciation	$	—	$	—	$	1.4	$	1.4
Severance and related costs		5.3		—		3.3		8.6
Other, net		10.3		1.1		0.2		11.6
Total selling, general and administrative expenses		15.6		1.1		4.9		21.6
Consolidated total	$	15.6	$	1.1	$	4.9	$	21.6

Included in the above estimates are $20.2 million of charges that have resulted or will result in cash outflows and $1.4 million of non-cash charges.

During the first quarter of fiscal 2012, we recognized the following pre-tax charges in our condensed consolidated statement of earnings for the Administrative Efficiency Plan:

	Consumer		Commercial
	Foods		Foods		Corporate		Total
Accelerated depreciation	$	—	$	—	$	0.4	$	0.4
Severance and related costs		5.3		—		3.0		8.3
Other, net		2.2		0.4		—		2.6
Total selling, general and administrative expenses		7.5		0.4		3.4		11.3
Consolidated total	$	7.5	$	0.4	$	3.4	$	11.3

Liabilities recorded for the various initiatives and changes therein for the first quarter of fiscal 2012 under the Administrative Efficiency Plan were as follows:

	Balance at		Costs Incurred							Balance at
	May 29,		and Charged		Costs Paid			Changes in		August 28,
	2011		to Expense		or Otherwise Settled			Estimates		2011
Severance and related costs	$	—	$	8.3	$	(0.1	)	$	—	$	8.2
Plan implementation costs		—		2.6		(0.2	)		—		2.4
Total	$	—	$	10.9	$	(0.3	)	$	—	$	10.6

Network Optimization Plan

During the third quarter of fiscal 2011, our Board of Directors approved a plan recommended by executive management designed to optimize our manufacturing and distribution networks. We refer to this plan as the “Network Optimization Plan”. The Network Optimization Plan consists of projects that involve, among other things, the exit of certain manufacturing facilities, the disposal of underutilized manufacturing assets, and actions designed to optimize our distribution network. The Network Optimization Plan is expected to be implemented by the end of fiscal 2013 and is intended to improve the efficiency of our manufacturing operations and reduce costs.

In connection with the Network Optimization Plan, we expect to incur pre-tax cash and non-cash charges for asset impairments, accelerated depreciation, severance, relocation, and site closure costs of $68.3 million. We have recognized, and/or expect to recognize, expenses associated with the Network Optimization Plan, including but not limited to, impairments of property, plant and equipment, accelerated depreciation, severance and related costs, and plan implementation costs (e.g., consulting, employee relocation, etc.). We anticipate that we will recognize the following pre-tax expenses associated with the Network Optimization Plan in the fiscal 2011 to fiscal 2013 timeframe (amounts include charges recognized in fiscal 2011 and in the first quarter of fiscal 2012):

	Consumer		Commercial
	Foods		Foods		Total
Accelerated depreciation	$	17.4	$	—	$	17.4
Inventory write-offs and related costs		3.1		0.3		3.4
Total cost of goods sold		20.5		0.3		20.8
Asset impairment		10.6		13.8		24.4
Severance and related costs		8.0		0.1		8.1
Other, net		12.3		2.7		15.0
Total selling, general and administrative expenses		30.9		16.6		47.5
Consolidated total	$	51.4	$	16.9	$	68.3

Included in the above estimates are $25.4 million of charges that have resulted or will result in cash outflows and $42.9 million of non-cash charges.

During the first quarter of fiscal 2012, we recognized the following pre-tax charges in our condensed consolidated statement of earnings for the Network Optimization Plan:

	Consumer		Commercial
	Foods		Foods		Total
Accelerated depreciation	$	2.7	$	—	$	2.7
Inventory write-offs and related costs		0.4		—		0.4
Total cost of goods sold		3.1		—		3.1
Asset impairment		2.1		3.4		5.5
Severance and related costs		0.6		—		0.6
Other, net		1.2		0.4		1.6
Total selling, general and administrative expenses		3.9		3.8		7.7
Consolidated total	$	7.0	$	3.8	$	10.8

We recognized the following cumulative (plan inception to August 28, 2011) pre-tax charges related to the Network Optimization Plan in our condensed consolidated statement of earnings:

	Consumer		Commercial
	Foods		Foods		Total
Accelerated depreciation	$	7.8	$	—	$	7.8
Inventory write-offs and related costs		0.6		0.3		0.9
Total cost of goods sold		8.4		0.3		8.7
Asset impairment		10.6		13.8		24.4
Severance and related costs		5.7		0.1		5.8
Other, net		1.9		0.4		2.3
Total selling, general and administrative expenses		18.2		14.3		32.5
Consolidated total	$	26.6	$	14.6	$	41.2

Liabilities recorded for the various initiatives and changes therein for the first quarter of fiscal 2012 under the Network Optimization Plan were as follows:

	Balance at		Costs Incurred							Balance at
	May 29,		and Charged		Costs Paid			Changes in		August 28,
	2011		to Expense		or Otherwise Settled			Estimates		2011
Severance and related costs	$	4.8	$	0.7	$	(0.3	)	$	—	$	5.2
Plan implementation costs		—		1.6		(1.5	)		—		0.1
Total	$	4.8	$	2.3	$	(1.8	)	$	—	$	5.3

2010 Restructuring Plan

During the fourth quarter of fiscal 2010, our Board of Directors approved a plan recommended by executive management related to the long-term production of our meat snack products. The plan provides for the closure of our meat snacks production facility in Garner, North Carolina, and the movement of production to our existing facility in Troy, Ohio. Since the Garner accident, the Troy facility has been producing a portion of our meat snack products. By the end of fiscal 2011, the plan was substantially implemented.

Also in the fourth quarter of fiscal 2010, we made a decision to consolidate certain administrative functions from Edina, Minnesota, to Naperville, Illinois. We completed the transition of these functions in fiscal 2011. This plan, together with the plan to move production of our meat snacks from Garner, North Carolina to Troy, Ohio, is collectively referred to as the 2010 restructuring plan (“2010 plan”).

In connection with the 2010 plan, we expect to incur pre-tax cash and non-cash charges for asset impairments, accelerated depreciation, severance, relocation, and site closure costs of $66.8 million, of which $25.7 million was recognized in fiscal 2011 and $39.2 million was recognized in fiscal 2010. We have recognized expenses associated with the 2010 plan, including but not limited to, impairments of property, plant and equipment, accelerated depreciation, severance and related costs, and plan implementation costs (e.g., consulting, employee relocation, etc.). We anticipate that we will recognize the following pre-tax expenses associated with the 2010 plan in the fiscal 2010 to 2012 timeframe (amounts include charges recognized in fiscal 2010, 2011, and the first quarter of fiscal 2012):

	Consumer
	Foods		Corporate		Total
Accelerated depreciation	$	19.1	$	—	$	19.1
Inventory write-offs and related costs		0.7		—		0.7
Total cost of goods sold		19.8		—		19.8
Asset impairment		16.9		—		16.9
Severance and related costs		17.0		—		17.0
Other, net		9.5		3.6		13.1
Total selling, general and administrative expenses		43.4		3.6		47.0
Consolidated total	$	63.2	$	3.6	$	66.8

Included in the above estimates are $28.2 million of charges which have resulted or will result in cash outflows and $38.6 million of non-cash charges.

During the first quarter of fiscal 2012, we recognized $1.5 million of pre-tax charges in our condensed consolidated statement of earnings for the 2010 plan.

We recognized the following cumulative (plan inception to August 28, 2011) pre-tax charges related to the 2010 plan in our consolidated statement of earnings:

	Consumer
	Foods		Corporate		Total
Accelerated depreciation	$	19.1	$	—	$	19.1
Inventory write-offs and related costs		0.7		—		0.7
Total cost of goods sold		19.8		—		19.8
Asset impairment		16.8		—		16.8
Severance and related costs		17.0		—		17.0
Other, net		9.2		3.6		12.8
Total selling, general and administrative expenses		43.0		3.6		46.6
Consolidated total	$	62.8	$	3.6	$	66.4

Liabilities recorded for the various initiatives and changes therein for the first quarter of fiscal 2012 under the 2010 plan were as follows:

	Balance at		Costs Incurred								Balance at
	May 29,		and Charged		Costs Paid			Changes in			August 28,
	2011		to Expense		or Otherwise Settled			Estimates			2011
Severance and related costs	$	5.2	$	0.2	$	(3.7	)	$	(0.5	)	$	1.2
Plan implementation costs		1.0		1.0		(1.9	)		—			0.1
Other costs		2.7		—		(2.7	)		—			—
Total	$	8.9	$	1.2	$	(8.3	)	$	(0.5	)	$	1.3