Sara Lee 2013 Annual Report Download - page 47

The Hillshire Brands Company 45
The 2013 exit, disposal and restructuring related actions
are summarized below:
• Recognized third-party consulting costs related to cost
saving and efficiency studies
• Recognized severance charges associated with planned
employee terminations
• Recognized third-party costs associated with the spin-off
of international coffee and tea operations
• Recognized lease exit costs
• Disposed of certain manufacturing facilities related to the
Retail and Foodservice/Other segments and recognized a pretax
gain of $6 million.
During 2013, the company began implementation of various
cost saving and efficiency initiatives and recognized $17 million
of charges primarily related to consulting costs.
In 2012, the company recognized a charge to implement a plan
to terminate approximately 520 employees, related to the retail,
foodservice and corporate office operations and provide them with
severance benefits in accordance with benefit plans previously com-
municated to the affected employee group or with local employment
laws. As of June 29, 2013 all of the employees affected under this
plan have been terminated.
NOTE 7 – COMMON STOCK
On June 28, 2012, the company effected a 1-for-5 reverse stock
split of Hillshire Brands common stock. As a result, every five shares
of Hillshire Brands common stock were converted into one share
of Hillshire Brands common stock. Any reference to the number of
shares outstanding or any per share amounts has been adjusted to
reflect the impact of this reverse stock split.
Changes in outstanding shares of common stock for the past
three years were:
Shares in thousands 2013 2012 2011
Beginning balances 120,644 117,420 132,424
Stock issuances
Stock option and benefit plans 2,436 1,104 642
Restricted stock plans 155 2,119 398
Reacquired shares – – (16,044)
Other 131–
Ending balances 123,248 120,644 117,420
Common stock dividends and dividend-per-share amounts
declared on outstanding shares of common stock were:
In millions except per share data 2013 2012 2011
Common stock dividends declared $÷«61 $«137 $«275
Dividends per share amount declared $0.50 $1.15 $2.30
During 2010, the company’s Board of Directors had authorized
a $3.0 billion share repurchase program. In March of 2010, the com-
pany repurchased 7.3 million shares at a cost of $500 million under
this program using an accelerated share repurchase program (ASR).
The ASR provided for a final settlement adjustment at termination
in either shares of common stock or cash based on the final volume
weighted average stock price. In 2011, the company paid $13 million
as a final settlement on the ASR. During 2011, the company also
repurchased 16 million shares at a cost of $1.3 billion.
As of June 29, 2013, the remaining amount authorized for
repurchase is $1.2 billion of common stock under an existing share
repurchase program, plus 2.7 million shares of common stock that
remain authorized for repurchase under the company’s prior share
repurchase program.
NOTE 8 – ACCUMULATED OTHER
COMPREHENSIVE INCOME
The components of accumulated other comprehensive income are:
Net Unrealized Pension/
Gain (Loss) Post- Accumulated
Cumulative on Qualifying retirement Other
Translation Cash Flow Liability Comprehensive
In millions Adjustment Hedges/Other Adjustment Income (Loss)
Balance at July 3, 2010 $(106) $(1) $(807) $(914)
Disposition of Household &
Body Care businesses 55 – – 55
Amortization of net actuarial
loss and prior service credit – – 16 16
Net actuarial gain arising
during the period – – 326 326
Pension plan curtailment – – 25 25
Other comprehensive
income (loss) activity 270 7 (50) 227
Balance at July 2, 2011 219 6 (490) (265)
Business dispositions 127 – – 127
Amortization of net actuarial
loss and prior service credit – – (1) (1)
Net actuarial loss arising
during the period – – (70) (70)
Pension plan curtailments/
settlements – – 24 24
Spin-off of International
Coffee and Tea business (180) – 343 163
Other comprehensive
income (loss) activity (150) 2 26 (122)
Balance at June 30, 2012 16 8 (168) (144)
Business dispositions (15) – – (15)
Amortization of net actuarial
loss and prior service credit – – (2) (2)
Net actuarial gain arising
during the period – – 27 27
Pension plan curtailments/
settlements ––1 1
Spin-off of International
Coffee and Tea business 6–– 6
Other comprehensive
income (loss) activity (6) (8) – (14)
Balance at June 29, 2013 $÷÷«1 $«– $(142) $(141)