Hasbro 2012 Annual Report Download - page 93

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HASBRO, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements — (Continued)
(Thousands of Dollars and Shares Except Per Share Data)
At December 30, 2012, the Company had approximately $262,101 in outstanding inventory and tooling
purchase commitments.
Hasbro is party to certain legal proceedings, as well as certain asserted and unasserted claims. Amounts
accrued, as well as the total amount of reasonably possible losses with respect to such matters, individually and
in the aggregate, are not deemed to be material to the consolidated financial statements.
(18) 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 operating cost savings.
The Company incurred restructuring charges of $36,045 in the fourth quarter of 2012 which included severance
costs of $34,888 related to the planned reduction of approximately 560 employees and $1,157 of facility costs
related to the commencement of this program. Of the amount recognized, substantially all of the amount is
included in accrued liabilities at December 30, 2012.
Another phase of this initiative includes a voluntary retirement program for certain eligible employees in the
United States that was announced during 2013. Costs associated with this component of the program, along with
other aspects of the cost savings initiative to be implemented in 2013, will be recognized in 2013 and beyond.
The Company also expects that it may incur additional pension charges in 2013 resulting from the reduction in
workforce, including the 2013 voluntary retirement program.
For the year ended December 30, 2012, restructuring charges related to the cost savings initiative were
recorded in the consolidated statements of operations as follows:
Severance
Costs
Building
Costs Total
Product development ...................................... $ 8,469 — 8,469
Selling, distribution and administration ........................ 26,419 1,157 27,576
$34,888 1,157 36,045
(19) Segment Reporting
Segment and Geographic Information
Hasbro is a worldwide leader in children’s and family leisure time products and services, including toys,
games and licensed products ranging from traditional to high-tech and digital. The Company’s segments are
(i) U.S. and Canada, (ii) International, (iii) Entertainment and Licensing, and (iv) Global Operations.
The U.S. and Canada segment includes the marketing and selling of boys’ action figures, vehicles and
playsets, girls’ toys, electronic toys and games, plush products, preschool toys and infant products, electronic
interactive products, toy-related specialty products, traditional board games and puzzles, DVD-based games and
trading card and role-playing games within the United States and Canada. Within the International segment, the
Company markets and sells both toy and certain game products in markets outside of the U.S. and Canada,
primarily the European, Asia Pacific, and Latin and South American regions. The Company’s Entertainment and
Licensing segment includes the Company’s lifestyle licensing, digital gaming, movie, television and online
entertainment operations. The Global Operations segment is responsible for manufacturing and sourcing finished
products for the Company’s U.S. and Canada and International segments.
Segment performance is measured at the operating profit level. Included in Corporate and eliminations are
certain corporate expenses, including substantially all costs incurred related to the 2012 business restructuring,
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