Restructuring And Impairment Charges

6 Months Ended

Jun. 30, 2011

Restructuring And Impairment Charges

Restructuring And Impairment Charges

6. Restructuring and Impairment Charges

Restructuring and Impairment Costs Charged to Results of Operations

For the three months ended June 30, 2011 and 2010, the Company recorded the following net restructuring and impairment charges:

	Three Months Ended June 30, 2011								Three Months Ended June 30, 2010
	Employee Terminations		Other Charges		Impairment		Total		Employee Terminations		Other Charges		Impairment		Total
U.S. Print and Related Services	$	22.0	$	19.5	$	23.6	$	65.1	$	1.2	$	1.3	$	1.0	$	3.5
International		6.7		2.6		0.5		9.8		4.9		1.3		0.3		6.5
Corporate		0.5		0.1		0.2		0.8		—		0.5		0.2		0.7
Total	$	29.2	$	22.2	$	24.3	$	75.7	$	6.1	$	3.1	$	1.5	$	10.7

For the six months ended June 30, 2011 and 2010, the Company recorded the following net restructuring and impairment charges:

	Six Months Ended June 30, 2011								Six Months Ended June 30, 2010
	Employee Terminations		Other Charges		Impairment		Total		Employee Terminations			Other Charges		Impairment		Total
U.S. Print and Related Services	$	36.8	$	36.0	$	30.5	$	103.3	$	4.1		$	3.3	$	2.0	$	9.4
International		14.6		3.4		1.0		19.0		11.3			4.4		0.3		16.0
Corporate		2.6		0.7		0.9		4.2		(0.1	)		0.7		0.2		0.8
Total	$	54.0	$	40.1	$	32.4	$	126.5	$	15.3		$	8.4	$	2.5	$	26.2

For the three and six months ended June 30, 2011, the Company recorded net restructuring charges of $29.2 million and $54.0 million, respectively, related to employee termination costs for 1,859 employees, of whom 1,106 were terminated as of June 30, 2011. These charges related to the closings of certain facilities and headcount reductions due to the Bowne acquisition, as well as the completed or announced closing of three book and directories manufacturing facilities and one commercial manufacturing facility within the U.S. Print and Related Services segment. Additionally, the Company incurred multi-employer pension plan partial withdrawal charges, lease termination and other restructuring charges of $22.2 million and $40.1 million for the three and six months ended June 30, 2011, respectively. Of this amount, $15.8 million related to multi-employer pension plan partial withdrawal charges primarily attributable to the announced closing of three manufacturing facilities within the U.S. Print and Related Services segment. For the three and six months ended June 30, 2011, the Company also recorded $24.3 million and $32.4 million, respectively, of impairment charges primarily for machinery and equipment and leasehold improvements associated with the facility closings. The fair values of the machinery and equipment and leasehold improvements were determined to be Level 3 under the fair value hierarchy and were estimated based on discussions with machinery and equipment brokers, dealer quotes and internal expertise related to the equipment and current marketplace conditions.

For the three and six months ended June 30, 2010, the Company recorded net restructuring charges of $6.1 million and $15.3 million, respectively, for employee termination costs for 851 employees, all of whom were terminated as of June 30, 2011. These terminations were associated with actions resulting from the reorganization of certain operations, including those within the business process outsourcing and Latin America reporting units. In addition, continuing charges resulting from the closing of two Global Turnkey Solutions manufacturing facilities in 2009 within the International segment were recorded in 2010. These actions also included the reorganization of certain operations within the magazine, catalog and retail insert and variable print reporting units and the closing of one forms and labels manufacturing facility within the U.S. Print and Related Services segment. Additionally, the Company incurred other restructuring charges, including lease termination and other facility closure costs, of $3.1 million and $8.4 million, respectively, for the three and six months ended June 30, 2010. For the three and six months ended June 30, 2010, the Company also recorded $1.5 million and $2.5 million, respectively, of impairment charges primarily for machinery and equipment and leasehold improvements associated with the facility closings. The fair values of the machinery and equipment and leasehold improvements were determined to be Level 3 under the fair value hierarchy and were estimated based on discussions with machinery and equipment brokers, dealer quotes and internal expertise related to the equipment and current marketplace conditions.

Restructuring Reserve

The restructuring reserve as of June 30, 2011 and December 31, 2010 and changes during the six months ended June 30, 2011 were as follows:

	December 31, 2010		Restructuring Costs Charged to Results of Operations		Foreign Exchange and Other			Cash Paid			June 30, 2011
Employee terminations	$	11.2	$	54.0	$	0.1		$	(24.3	)	$	41.0
Lease terminations		28.1		14.9		0.7			(14.0	)		29.7
Multi-employer pension withdrawal obligations		13.6		15.8		—			(0.2	)		29.2
Other		1.1		9.4		(1.1	)		(7.8	)		1.6
Total	$	54.0	$	94.1	$	(0.3	)	$	(46.3	)	$	101.5

The current portion of restructuring reserves of $58.2 million was included in accrued liabilities at June 30, 2011, while the long-term portion of $43.3 million, primarily related to multi-employer pension plan partial withdrawal charges and lease termination costs, was included in other noncurrent liabilities at June 30, 2011.

The Company anticipates that payments associated with the employee terminations reflected in the above table will be substantially completed by June of 2012.

Payments on certain of the lease obligations are scheduled to continue until 2026 and payments on certain of the multi-employer pension plan partial withdrawal charges are scheduled to continue until 2021. Market conditions and the Company's ability to sublease these properties could affect the ultimate charge related to the lease obligations. Any potential recoveries or additional charges could affect amounts reported in the Condensed Consolidated Financial Statements of future periods.