Thailand Flood Related Charges

12 Months Ended

Dec. 31, 2012

Thailand Flood Related Charges [Abstract]

Thailand Flood Related Charges

Note 16—Thailand Flood Related Charges

The Company's facilities in Ayudhaya, Thailand were flooded and remained closed from October 13, 2011 to December 20, 2011. As a result of the flooding and temporary closing of these facilities, the Company recognized estimated property losses of $46.2 million and incurred $13.4 million of flood related costs during the three months ended December 31, 2011. The Company carried property and business interruption insurance with a combined limit for real and personal property as well as business interruption insurance of approximately $300 million. As such, during the three months ended December 31, 2011, the Company recorded estimated recoveries from insurance for these property losses and flood related costs totaling $56.2 million, including $46.2 million of property losses from the involuntary conversion of property, plant and equipment and inventory and $10.0 million of other costs directly related to the flooding in Thailand.

During the year ended December 31, 2012, the Company reduced the estimated property losses and the corresponding estimated insurance recoveries for these property losses by $5.1 million. In addition, the Company received $58.2 million of insurance proceeds which exceeded our previously recorded insurance receivable by $7.1 million. The insurance proceeds included $48.2 million for Thailand property losses and $10.0 million for other flood related costs. As of December 31, 2012, the Company has collected its recorded insurance receivable for these property losses and flood related costs.

During the year ended December 31, 2012, the Company recognized additional Thailand flood related charges totaling $16.1 million, which were offset by the insurance recoveries totaling $7.1 million in excess of previously recognized inventory and property, plant and equipment losses. While all of these charges consist of costs directly attributable to the Thailand flood which the Company expects to recover from its insurance, the Company will record additional insurance recoveries when the appropriate recognition criteria have been met. The Company cannot estimate the timing of the receipt of insurance proceeds it will ultimately realize. The Company does not expect to incur significant additional Thailand flood related charges. As a result of the flooding, the Company has been unable to renew or otherwise obtain adequate cost-effective flood insurance to cover assets at its facilities in Thailand. The Company continues to investigate all flood risk-mitigation alternatives in Thailand. In the event the Company was to experience a significant uninsured loss in Thailand or elsewhere, it could have a material adverse effect on its business, financial condition and results of operations.