Restructuring Charges

9 Months Ended

Jun. 29, 2013

In the first quarter of 2013, as part of our strategy to reduce costs and to realign our business, we implemented a restructuring of our business and recorded restructuring charges of $15.5 million. The restructuring charges included $15.5 million for severance and related costs associated with 168 employees notified of termination during the first quarter and $27 thousand of charges related to excess facilities. In addition, the first quarter of 2013 restructuring charges include a benefit of $0.1 million related to adjusting facility accruals recorded in prior periods.

In the second quarter of 2013, we adopted a plan to further restructure our workforce and related facilities to enhance long-term profitability and recorded a restructuring charge of $15.8 million. The restructuring charges included $14.4 million for severance and related costs associated with 120 employees notified of termination in the second quarter and $1.4 million related to facility consolidations.

In the third quarter of 2013, we implemented a further restructuring of our workforce and recorded a restructuring charge of $3.1 million primarily for severance and related costs associated with 63 employees notified of termination, approximately half of whom will continue to work for PTC through the fourth quarter. Severance costs for these employees are being recorded over their remaining service period and will result in restructuring charges of approximately $1 million in the fourth quarter.

In the second and third quarters of 2012, we implemented restructurings of our business and recorded restructuring charges of $20.8 million and $4.1 million, respectively. The restructuring charges primarily included severance and related costs associated with 168 and 41 employees notified of termination during the second and third quarters of 2012, respectively.

The employee terminations in prior quarters described above triggered curtailments of a non-U.S. pension plan and interim remeasurements of the pension plan's assets and liabilities. The remeasurements resulted in decreases in the plan's net unrecognized losses which were recorded in accumulated other comprehensive income of $2.1 million, $0.6 million and $1.2 million in the second quarter of 2013, the first quarter of 2013 and the second quarter of 2012, respectively, net of tax.

The following table summarizes restructuring accrual activity for the nine months ended June 29, 2013:



	2013 Restructuring Charges
	Employee Severance and Related Benefits			Facility Closures and Related Costs			Total			Prior (1)			Total
	(in thousands)
October 1, 2012	$	—		$	—		$	—		$	4,461		$	4,461
Charges to operations	33,166			1,397			34,563			(214		)	34,349
Cash disbursements	(26,057		)	(1,111		)	(27,168		)	(4,208		)	(31,376		)
Foreign exchange impact	(246		)	(11		)	(257		)	13			(244		)
Accrual, June 29, 2013	$	6,863		$	275		$	7,138		$	52		$	7,190

(1) The prior balances and activity are primarily for employee severance and related benefits related to the 2012 restructuring charges.

The accrual for facility closures and related costs is included in accrued expenses and other liabilities in the consolidated balance sheet, and the accrual for employee severance and related benefits is included in accrued compensation and benefits in the consolidated balance sheet.

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

+ References+ Details