Restructuring, integration and other charges | 6 Months Ended |
Dec. 28, 2013 |
Restructuring and Related Activities [Abstract] | ' |
Restructuring, integration and other charges | ' |
Restructuring, integration and other expenses |
Fiscal 2014 |
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During the second quarter and first six months of fiscal 2014, the Company implemented certain actions in an effort to reduce future operating costs including activities necessary to achieve planned synergies from recently acquired businesses. In addition, the Company incurred integration and other costs primarily associated with acquired or divested businesses. The following table presents the restructuring, integration and other expenses incurred during the second quarter and first half of fiscal 2014: |
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| Second Quarter | | Six Months | | | | | | | | |
Ended | Ended | | | | | | | | |
28-Dec-13 | 28-Dec-13 | | | | | | | | |
| (Thousands, except per share data) | | | | | | | | |
Restructuring costs | $ | 21,188 | | | $ | 26,904 | | | | | | | | | |
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Integration costs | 4,311 | | | 8,468 | | | | | | | | | |
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Other costs including acquisition costs | 1,488 | | | 4,541 | | | | | | | | | |
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Changes in estimate for prior and current year restructuring reserves | 1,455 | | | 628 | | | | | | | | | |
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Pre-tax restructuring, integration and other expenses | $ | 28,442 | | | $ | 40,541 | | | | | | | | | |
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After tax restructuring, integration and other expenses | $ | 21,746 | | | $ | 30,597 | | | | | | | | | |
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Restructuring, integration and other expenses per share on a diluted basis | $ | 0.15 | | | $ | 0.22 | | | | | | | | | |
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The activity related to the restructuring liabilities established during fiscal 2014 is presented in the following table: |
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| Severance | | Facility | | Other | | Total |
Reserves | Exit Costs |
| (Thousands) |
Fiscal 2014 pre-tax restructuring charges | $ | 23,486 | | | $ | 2,537 | | | $ | 881 | | | $ | 26,904 | |
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Cash payments | (4,660 | ) | | (228 | ) | | (9 | ) | | (4,897 | ) |
Non-cash amounts | — | | | (1,152 | ) | | (538 | ) | | (1,690 | ) |
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Other, principally foreign currency translation | 39 | | | 2 | | | 10 | | | 51 | |
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Balance at December 28, 2013 | $ | 18,865 | | | $ | 1,159 | | | $ | 344 | | | $ | 20,368 | |
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Severance charges recorded in the first half of fiscal 2014 related to the reduction, or planned reduction, of between approximately 700 to 800 employees, primarily in operations, sales and business support functions, in connection with cost reduction actions taken in both operating groups. Facility exit costs primarily consists of liabilities for remaining lease obligations and the write-down of long-lived assets for locations the Company has ceased using. Other restructuring costs related primarily to other miscellaneous restructuring and exit costs associated with the restructuring actions. Of the $26.9 million in restructuring costs recorded during the first half of fiscal 2014, $18.8 million related to EM, $7.6 million related to TS and $0.5 million related to corporate business support functions. As of December 28, 2013, management expects the majority of the remaining severance, facility exit costs and other liabilities to be paid by the end of fiscal 2014. The Company expects to incur up to $15.0 million to $25.0 million of additional restructuring costs during the remainder of fiscal 2014, primarily for severance and related amounts, related to the restructuring activities initiated, but not yet completed during the second quarter of fiscal 2014. |
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Integration costs are primarily related to the integration of acquired businesses and incremental costs incurred as part of the consolidation, relocation and closure of certain warehouse and office locations. Integration costs included consulting costs for IT system and business operation integration assistance, facility moving costs, legal fees, travel, meeting, marketing and communication costs that were incrementally incurred as a result of the integration activities. Also included in integration costs are incremental salary costs specific to integration, consolidation and closure activities. Other costs including acquisition costs consisted of professional fees incurred for acquisitions, additional costs incurred related businesses divested in prior periods, and other miscellaneous costs that relate to restructuring, integration and other expenses. |
Fiscal 2013 |
During fiscal 2013, the Company incurred restructuring expenses related to various restructuring actions intended to reduce costs in response to the then current market conditions. The following table presents the activity during the first six months of fiscal 2014 related to the remaining restructuring liabilities established during fiscal 2013: |
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| Severance | | Facility | | Other | | Total |
Reserves | Exit Costs |
| (Thousands) |
Balance at June 29, 2013 | $ | 25,254 | | | $ | 16,211 | | | $ | 370 | | | $ | 41,835 | |
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Cash payments | (11,943 | ) | | (4,665 | ) | | (899 | ) | | (17,507 | ) |
Changes in estimate, net | (1,204 | ) | | (2,168 | ) | | 1,615 | | | (1,757 | ) |
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Non-cash amounts | — | | | 538 | | | (756 | ) | | (218 | ) |
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Other, principally foreign currency translation | 194 | | | 294 | | | 150 | | | 638 | |
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Balance at December 28, 2013 | $ | 12,301 | | | $ | 10,210 | | | $ | 480 | | | $ | 22,991 | |
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As of December 28, 2013, management expects the majority of the remaining severance and other liabilities to be paid by the end of fiscal 2014 and the remaining facility exit cost liabilities to be paid by the end of fiscal 2018. |
Fiscal 2012 and prior |
As of June 29, 2013, there was $4.7 million of restructuring liabilities remaining related to restructuring actions taken in fiscal years 2012 and prior, the majority of which relates to facility exit costs. The remaining balance for such historical restructuring actions as of December 28, 2013 was $2.2 million, which is expected to be paid by the end of fiscal 2016. |