3Ware 2005 Annual Report Download - page 88

Download and view the complete annual report

Please find page 88 of the 2005 3Ware annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 98

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98

APPLIED MICRO CIRCUITS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following tables provide detailed activity related to each of the restructuring plan activities during the
year ended March 31, 2005 (in thousands):
Workforce
Reduction
Facilities
Consolidation and
Operating Lease
Commitments
Property
and
Equipment
Impairments Total
July 2001 Restructuring Program
Liability, March 31, 2004 ........................... $ — $ 68 $ — $ 68
Noncash charge ................................... — (26) — (26)
Adjustment ...................................... — (42) — (42)
Liability, March 31, 2005 ........................... $ — $ — $ — $ —
April 2003 Restructuring Program
Liability, March 31, 2004 ........................... $ 51 $5,639 $ — $ 5,690
Cash payments .................................... 2 (4,210) — (4,208)
Adjustments to expense ............................. (53) 372 — 319
Liability, March 31, 2005 ........................... $ — $1,801 $ — $ 1,801
November 2003 Restructuring Program
Liability, March 31, 2004 ........................... $ 15 $1,345 $ — $ 1,360
Cash payments .................................... (60) (1,590) — (1,650)
Adjustment ...................................... 45 245 — 290
Liability, March 31, 2005 ........................... $ — $ — $ — $ —
November 2004 Restructuring Program
Liability, March 31, 2004 ........................... $ — $ — $ — $ —
Charged to expense ................................ 4,369 499 4,187 9,055
Cash payments .................................... (3,672) (298) — (3,970)
Noncash charge ................................... — — (4,187) (4,187)
Liability, March 31, 2005 ........................... $ 697 $ 201 $ — $ 898
In July 2001, the Company announced the first of its restructuring programs. The July 2001 restructuring
plan was in response to the sharp downturn in business at the end of the Company’s fiscal 2001 and included
reducing the Company’s overall cost structure and aligning manufacturing capacity with the then current
demand. The restructuring plan consisted of the elimination of approximately 50 employees, or 5% of the
workforce, the consolidation of excess facilities and the write-off of certain property and equipment. As a result
of the July 2001 restructuring, the Company recorded a charge of $11.6 million consisting of $900,000 for
employee severances, $2.0 million of non-cancelable lease commitments, and $8.7 million for the disposal of
excess manufacturing equipment, the abandonment of certain leasehold improvements, and the write off of
software licenses.
During fiscal 2005, the Company has completed the restructuring activities contemplated by the July 2001
restructuring plan and no further payments or expenses are anticipated under this program.
In July 2002, the Company announced its second restructuring program, as a result of the prolonged
downturn in the telecommunications industry. The July 2002 restructuring program consisted of the closure of
the wafer manufacturing facility in San Diego and workforce reduction of approximately 165 employees or 25%
of the workforce. During fiscal 2003, the company recognized a total charge of $7.0 million consisting of $4.0
F-26