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RESTRUCTURING (Notes)
3 Months Ended
Sep. 28, 2024
Restructuring and Related Activities [Abstract]  
Restructuring and Cost Reduction Activities RESTRUCTURING
The Company views its restructuring programs as part of its operating principles to provide greater visibility in achieving its long-term profit growth and margin targets. Initiatives undertaken are generally expected to recover cash implementation costs within a 1 to 5-year period subsequent to completion. Completion (or as each major stage is completed in the case of multi-year programs) is when the project begins to deliver cash savings and/or reduced depreciation.
In the first quarter of 2024, the Company announced a reconfiguration of the North America frozen supply chain network, designed to drive increased productivity. The project is expected to be substantially completed by late 2024, with cost savings beginning to contribute to gross margin improvements in the second half of 2024 and reaching full-run rate in 2025. The overall project is expected to result in cumulative pretax charges of approximately $50 million, which include employee-related costs of $10 million, other cash costs of $10 million, and non-cash costs, primarily consisting of asset impairment, accelerated depreciation, and asset disposals of $30 million. Charges incurred related to this restructuring program were $7 million and $47 million during the quarter and year-to-date period ended September 28, 2024, respectively. These charges primarily related to severance costs and asset impairment, and were recorded in COGS.
In the first quarter of 2024, the Company proposed a reconfiguration of the European cereal supply chain network and completed collective bargaining obligations and consultation with impacted employees during the quarter ended June 29, 2024. The project, designed to drive efficiencies, is expected to be substantially completed by late 2026, with resulting efficiencies expected to begin contributing to gross margin improvements in late 2026. The overall project is expected to result in cumulative pretax charges of approximately $120 million, which include employee-related costs of $50 million, other cash costs of $30 million, and non-cash costs, primarily consisting of asset impairment, accelerated depreciation, and asset disposals of $40 million. Charges incurred related to this restructuring program were $5 million and $74 million during the quarter and year-to-date period ended September 28, 2024, respectively. These charges primarily related to severance costs and asset impairment and were recorded in COGS.
The tables below provide the details for charges incurred during the quarter and year-to-date period ended September 28, 2024.
 Quarter endedYear-to-date period endedProgram costs to date
(millions)September 28, 2024September 28, 2024September 28, 2024
Employee related costs$4 $41 $41 
Asset related costs1 9 9 
Asset impairment 60 60 
Other costs7 11 11 
Total$12 $121 $121 
 Quarter endedYear-to-date period endedProgram costs to date
(millions)September 28, 2024September 28, 2024September 28, 2024
North America$7 $47 $47 
Europe5 74 74 
Total$12 $121 $121 
All other restructuring projects were immaterial within the periods presented.
At September 28, 2024, total project reserves for the European and North American reorganizations were $34 million and $1 million, respectively. The reserves were related to severance payments and other costs of which a substantial portion will not be paid during the current year. The following table provides details for exit cost reserves related to the European and North American reorganizations described above.
Employee
Related
Costs
Asset
Impairment
Asset
Related
Costs
Other
Costs
Total
Liability as of December 30, 2023$— $— $— $— $— 
2024 restructuring charges41 60 11 121 
Cash payments(7)— — (11)(18)
Non-cash charges and other(60)(9)— (68)
Liability as of September 28, 2024$35 $ $ $ $35