Sara Lee 2010 Annual Report Download - page 70

Notes to financial statements
The following table summarizes the net charges taken for the
exit, disposal and transformation activities approved during 2008
and the related status as of July 3, 2010. The accrued amounts
remaining represent those cash expenditures necessary to satisfy
remaining obligations. The majority of the cash payments to satisfy
the accrued costs are expected to be paid in the next year. The
corporation does not anticipate any additional material future
charges related to the 2008 actions.
Non-
cancelable
Employee Lease Asset and Transfor-
Termination and Other Business mation
and Other Contractual Disposition Costs – IT
In millions Benefits Obligations Actions and Other Total
Exit, disposal and other
costs recognized
during 2008 $«36 $«3 $(2) $«28 $«65
Charges recognized in
discontinued operations ––1 78
Cash payments (7) – – (33) (40)
Asset and business
disposition gains (losses) ––1 –1
Accrued costs as
of June 28, 2008 293– 234
Cash payments (15) – – (2) (17)
Change in estimate (2) – – – (2)
Foreign exchange impacts (1) – – – (1)
Accrued costs as
of June 27, 2009 113– –14
Cash payments (5) (1) – – (6)
Change in estimate (2)4– –2
Accrued costs as
of July 3, 2010 $÷«4 $«6 $«– $÷«– $«10
Other Restructuring Actions Prior to 2008, the corporation had
approved and completed various actions to exit certain defined
business activities and lower its cost structure, and these actions
have had minimal impact on current year results. In 2010, adjust-
ments were made to certain accrued obligations remaining for these
completed actions. These adjustments related to the final settlement
of certain planned termination actions which increased income from
continuing operations before income taxes by $1 million and are
reported in the “Net charges for exit activities, asset and business
dispositions” line of the Consolidated Statements of Income.
As of July 3, 2010, the accrued liabilities remaining in the
Consolidated Balance Sheet related to these completed actions
total $14 million and represent certain severance obligations. These
accrued amounts are expected to be satisfied in cash and will be
funded from operations.
Note 7 – Common Stock
Changes in outstanding shares of common stock for the past three
years were:
Shares in thousands 2010 2009 2008
Beginning balances 695,658 706,359 724,433
Stock issuances
Stock option and benefit plans 1,055 38 1,163
Restricted stock plans 1,741 543 320
Reacquired shares (36,417) (11,390) (19,669)
Other 81 108 112
Ending balances 662,118 695,658 706,359
Common stock dividends and dividend-per-share amounts
declared on outstanding shares of common stock were:
In millions except per share data 2010 2009 2008
Common stock dividends declared $«299 $«306 $«298
Dividends per share amount declared $0.44 $0.44 $0.42
The corporation repurchases common stock at times
management deems appropriate, given current market valuations.
Sara Lee announced on September 25, 2009 that its Board of
Directors had authorized a $1.0 billion share repurchase program
and on February 16, 2010 that its Board of Directors had increased
this repurchase program by $2.0 billion shares (for a total authori-
zation of $3.0 billion shares). In March of 2010, the corporation
repurchased 36.4 million shares at a cost of $500 million under
this program using an accelerated share repurchase program (ASR).
The ASR provides for a final settlement adjustment at termi nation in
either shares of common stock or cash based on the final volume
weighted average stock price. Subsequent to year end, the corpora-
tion paid $13 million as a final settlement on the ASR.
As of July 3, 2010, the corporation was authorized to repurchase
$2.5 billion of common stock under its existing share repurchase
program, plus 13.5 million shares of common stock that remain
authorized for repurchase under the corporation’s prior share repur-
chase program. The timing and amount of future share repurchases
will be based upon the completion of the corporation’s sale of its
household and body care businesses, market conditions and
other factors.
68 Sara Lee Corporation and Subsidiaries