Lexmark 2009 Annual Report Download - page 50

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April 2009 Restructuring Plan
General
As part of Lexmark’s ongoing plan to consolidate manufacturing capacity and reduce costs and expenses
worldwide, the Company announced on April 21, 2009 the planned closure of its inkjet cartridge
manufacturing facility in Juarez, Mexico by the end of the first quarter of 2010 as well as the
continued restructuring of its worldwide workforce (the “April 2009 Restructuring Plan”). The April
2009 Restructuring Plan is expected to impact about 360 positions worldwide, with approximately 270
coming from the closure of the facility in Juarez, Mexico. The Company expects the April 2009
Restructuring Plan will result in total pre-tax charges of approximately $50.0 million with cash costs
estimated at $10.0 million. The Company expects the April 2009 Restructuring Plan to be substantially
completed by the end of the second quarter of 2010 and currently expects total 2010 savings of more than
$20.0 million.
Impact to 2009 Financial Results
For the year ended December 31, 2009, the Company incurred charges of $44.3 million for the April 2009
Restructuring Plan as follows:
(In Millions)
April 2009
Restructuring-
related Charges
(Note 4) Project Costs Total
Accelerated depreciation charges/project costs . . . . . . . . . . $34.7 $2.3 $37.0
Employee termination benefit charges/project costs . . . . . . . 5.9 1.4 7.3
Total restructuring-related charges/project costs . . . . . . . . . . $40.6 $3.7 $44.3
The Company incurred $37.0 million of accelerated depreciation charges and project costs in Cost of
revenue on the Consolidated Statements of Earnings. Total employee termination benefit charges of
$5.9 million are included in Restructuring and related charges, and $1.4 million of related project costs are
included in Selling, general and administrative on the Company’s Consolidated Statements of Earnings.
For the year ended December 31, 2009, the Company incurred restructuring and related charges and
project costs related to the April 2009 restructuring plan of $4.2 million in PSSD, $39.0 million in ISD and
$1.1 million in All other.
Liability Rollforward
The following table represents a rollforward of the liability incurred for employee termination benefits in
connection with the April 2009 Restructuring Plan. The liability is included in Accrued liabilities on the
Company’s Consolidated Statements of Financial Position.
Employee
Termination
Benefits
Balance at January 1, 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ —
Costs incurred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.4
Payments & Other
(1)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4.5)
Reversals
(2)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.6)
Balance at December 31, 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1.3
(1)
Other consists of changes in the liability balance due to foreign currency translations.
(2)
Reversals due to changes in estimates for employee termination benefits
44