Activision 2008 Annual Report Download - page 75

Download and view the complete annual report

Please find page 75 of the 2008 Activision 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 116

  • 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
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116

61
Severance(1) Facilities
costs(1)
Asset
write-
down(2)
Contract
termination
costs(1)
Loss on disposal
of
assets/liabilities(3) Total
Balance at December 31, 2007...
.
$— $— $— $— $— $—
Costs charged to expense............
.
54 7 26 5 1 93
Costs paid or otherwise settled...
.
(18) — — (3) — (21)
Non-cash write-down:
Fixed asset disposals...............
.
— — (5) — — (5)
Impairment of acquired trade
name ...................................
.
— — (5) — — (5)
Impairment of goodwill..........
.
— — (16) — — (16)
Foreign exchange and other........
.
1 — — (2) (1) (2)
Balance at December 31, 2008...
.
$37 $7 $— $— $— $44
(1) Accounted for in accordance with Statement of Financial Accounting Standards 146,
“Accounting for Costs Associated with Exit or Disposal Activities” (“SFAS No. 146”).
(2) Accounted for in accordance with SFAS No. 144 and SFAS No. 142.
(3) For the year ended December 31, 2008, we have recorded a loss on disposal of assets and
liabilities of $1 million associated with winding down certain studios through selling their
assets and liabilities. The proceeds from these asset sale transactions amounted to
approximately $9 million, net of legal and other transaction costs. The assets disposed of
include $8 million of goodwill, $1 million of intangible assets, $3 million of property and
equipment, and $2 million of liabilities. The loss on disposal of assets and liabilities is
included in the restructuring costs in the Consolidated Statements of Operations.
The total restructuring reserve balances at December 31, 2008 and the net restructuring
charges for the year ended December 31, 2008 are presented below by operating segments
(amounts in millions):
Restructuring charges
At
December 31, 2008 For the year ended
December 31, 2008
Activision ................................................... $— $2
Blizzard ...................................................... — —
Distribution................................................. — —
Activision Blizzard’s core operations......... — 2
Activision Blizzard’s non-core exit
operations ............................................... 44 91
Total............................................................ $44 $93
The expected restructuring charges to be incurred principally by Activision Blizzard’s
non-core exit operations related to the Business Combination during the next six months are
presented below (amounts in millions):
Low High
Expected future restructuring costs, before tax..........................
.
$20 $40
Expected future restructuring costs, after tax.............................
.
15 25