AMD 2001 Annual Report Download - page 203

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following table summarizes activity under the plan through December 30,
2001:
-----------------------------------------------------------------------------------------------------------
Facility Facility and
Severance and and equipment Other
employee equipment decommission facilities
(Thousands) benefits impairment costs exit costs Total
-----------------------------------------------------------------------------------------------------------
2001 provision $ 34,105 $ 39,000 $ 15,500 $ 700 $ 89,305
Cash charges (7,483) - - (54) (7,537)
Non-cash charges - (39,000) - - (39,000)
-----------------------------------------------------------------------------------------------------------
Accruals at December 30, 2001 $ 26,622 $ - $ 15,500 $ 646 $ 42,768
-----------------------------------------------------------------------------------------------------------
We expect to substantially complete execution of our restructuring plan by the
end of the second quarter of 2002. As a result of this restructuring plan, we
expect to realize overall cost reductions of $125 million on an annualized
basis. As of December 30, 2001, 786 employees had been terminated resulting in
cash payments of approximately $7.5 million in severance and employee benefit
costs.
During 1999, we initiated a review of our cost structure. Based upon this
review, we recorded restructuring and other special charges of $38 million in
1999 to better align our cost structure with expected revenue growth rates.
The restructuring and other special charges for the year ended December 26,
1999, and related activity during 1999, 2000 and 2001, are reflected in the
following table:
----------------------------------------------------------------------------------------------------------------------
Severance
and Equipment Discontinued
employee disposal system
(Thousands) benefits Facilities Equipment costs projects Total
----------------------------------------------------------------------------------------------------------------------
1999 provision $ 3,024 $ 968 $ 23,769 $ 4,380 $ 6,089 $ 38,230
Cash charges (3,024) (56) - (1,937) - (5,017)
Non-cash charges - - (23,769) - (6,089) (29,858)
----------------------------------------------------------------------------------------------------------------------
Accruals at December 26, 1999 - 912 - 2,443 - 3,355
Cash charges - (429) - (2,443) - (2,872)
----------------------------------------------------------------------------------------------------------------------
Accruals at December 31, 2000 - 483 - - - 483
Cash charges - (443) - - - (443)
----------------------------------------------------------------------------------------------------------------------
Accruals at December 30, 2001 $ - $ 40 $ - $ - $ - $ 40
----------------------------------------------------------------------------------------------------------------------
13
Source: ADVANCED MICRO DEVIC, 10-K, March 07, 2002