Lexmark 2011 Annual Report Download - page 106

In 2011, the Company recorded impairment charges of $1.0 million related to its manufacturing facility
in Juarez, Mexico, and $3.6 million related to one of its support facilities in Orleans, France for which
the current fair values had fallen below the carrying values. The asset impairment charges were
determined in accordance with the FASB guidance on accounting for the impairment or disposal of
long-lived assets and are included in Selling, general and administrative on the Company’s
Consolidated Statements of Earnings. Subsequent to the impairment charge, the Juarez, Mexico
facility was sold and the Company recognized a $0.6 million pre-tax gain on the sale that is included in
Selling, general and administrative on the Company’s Consolidated Statements of Earnings. This gain
is not included in the total restructuring-related charges (reversals) presented in the table above.
During 2010, the Company sold one of its inkjet supplies manufacturing facilities in Chihuahua, Mexico
for $5.6 million and recognized a $0.5 million pre-tax gain on the sale that is included in Selling,
general and administrative on the Company’s Consolidated Statements of Earnings. This gain is not
included in the total restructuring-related charges (reversals) presented in the table above.
For the years ended December 31, 2011, 2010 and 2009, Employee termination benefit charges
(reversals) and contract termination and lease charges (reversals) are included in Restructuring and
related charges on the Consolidated Statements of Earnings.
For the year ended December 31, 2010, the $(1.6) million reversal for employee termination benefit
charges is due primarily to revisions in assumptions. The $(0.9) million reversal for contract termination
and lease charges is due to the Company’s decision to reuse a leased building that had earlier been
vacated as a result of restructuring actions.
For the years ended December 31, 2011, 2010 and 2009, the Company incurred restructuring-related
charges (reversals) in the Company’s segments as follows:
2011 2010 2009
ISS .............................................................. $1.2 $ 1.1 $45.7
All other .......................................................... 3.7 (1.2) 6.8
Total charges ...................................................... $4.9 $(0.1) $52.5
Liability Rollforward
The following table represents a rollforward of the liability incurred for employee termination benefits
and contract termination and lease charges in connection with the Company’s Other Restructuring
Actions. The liability is included in Accrued liabilities on the Company’s Consolidated Statements of
Financial Position.
Employee
Termination
Benefits
Contract
Termination &
Lease Charges Total
Balance at January 1, 2009 .............................. $33.4 $ 5.9 $ 39.3
Costs incurred ....................................... 20.1 0.4 20.5
Payments & Other (1) .................................. (30.4) (3.9) (34.3)
Reversals (2) ......................................... (4.1) — (4.1)
Balance at December 31, 2009 ........................... $19.0 $ 2.4 $ 21.4
Costs incurred ....................................... 0.5 — 0.5
Payments & Other (1) .................................. (14.9) (1.5) (16.4)
Reversals (2) ......................................... (2.3) (0.9) (3.2)
Balance at December 31, 2010 ........................... $ 2.3 $ — $ 2.3
Costs incurred ....................................... 0.1 — 0.1
Payments & Other (1) .................................. (1.7) — (1.7)
Reversals (2) ......................................... (0.1) — (0.1)
Balance at December 31, 2011 ........................... $ 0.6 $ — $ 0.6
(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.
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