Consolidation Program and Restructuring Charge

9 Months Ended

Sep. 29, 2013

Consolidation Program and Restructuring Charge [Abstract]

Consolidation Program and Restructuring Charge

(9) Consolidation Program and Restructuring Charge

In the fourth quarter of 2012 the Company announced a multi-year cost savings initiative. This initiative includes workforce reductions, facility consolidations, process improvements and other cost savings measures. Through September 29, 2013, the Company has incurred pre-tax restructuring and partial pension settlement charges of $71,526 in connection with this initiative. Of these charges, $36,045 was recorded during the fourth quarter of 2012 and $35,481 was recorded during the nine months of 2013, of which $4,093 was recorded in the third quarter of 2013.

During the fourth quarter of 2012, charges included severance costs of $34,888 related to the reduction of approximately 560 employees and $1,157 of facility costs related to the commencement of this program. Charges for the nine months of 2013 totaled $35,481 and were comprised of $27,267in severance costs, $6,485 in non-cash pension charges, and $1,729 in costs associated with exiting a contractual obligation.  Severance costs recognized during the first nine months of 2013 primarily related to a voluntary retirement program for certain eligible employees in the United States. Non-cash pension charges included $2,959 which resulted from a curtailment charge related to the Company's U.S. pension plans during the first quarter of 2013 and $3,526 of partial settlement charges as a result of the amount of lump sum pension distributions to date during 2013, primarily related to restructuring activities. Costs associated with exiting a contractual obligation were paid during the quarter ended March 31, 2013. The total 2013 charge of $35,481 was recorded in the consolidated statements of operations as follows:  $8,493 – cost of sales; $3,515 – product development; and $23,473 – selling, distribution and administration.

The following is a summary of the severance and other personnel charges related to the Company's cost savings initiative included in accrued liabilities as of September 29, 2013:

Balance at December  30, 2012	$	34,888
2013 Charges		27,267
Payments		(24,620	)
Balance at September 29, 2013	$	37,535

The nine months ended September 30, 2012 also included severance charges of $11,130 associated with certain business functions.  These charges were recognized in the consolidated statement of operations as follows: $2,764 – cost of sales; $2,479 – product development; and $5,887 – selling, distribution and administration.

See Note 12 for information by segment.