Avnet 2006 Annual Report Download - page 85

AVNET, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
(5) Property, plant and equipment, net, for the EMEA region as of fiscal 2006, 2005 and 2004 includes
$25.9 million, $28.5 million, and $31.4 million, respectively, related to Germany and $13.5 million,
$14.2 million and $15.5 million, respectively, related to Belgium.
The Company manages its business based upon the operating results of its two operating groups before
restructuring and other charges (see Note 17). In fiscal 2006, and 2004 presented above, approximate
unallocated pre-tax restructuring, integration and other charges related to EM and TS, respectively, were
$53,456,000 and $9,529,000 in fiscal 2006 and, $19,446,000 and $29,920,000 in fiscal 2004. The remaining
restructuring, integration and other charges in each year relate to corporate activities.
17. Restructuring, integration and other charges
The Company recorded a number of restructuring, integration and other charges during fiscal 2006 and
2004. There were no restructuring charges recorded in fiscal 2005. The fiscal 2006 restructuring, integration
and other charges relate primarily to actions taken to integrate Memec into the existing Avnet business as well
as actions taken in connection with recent divestitures, and other actions. The fiscal year 2004 charges relate
primarily to the reorganization of operations in each of the three major regions of the world in which the
Company operates, generally taken in response to business conditions at the time of the charge and as part of
the Company's efforts to return to the profitability levels enjoyed by the business prior to the industry and
economic downturn that commenced in fiscal 2001.
Fiscal 2006
During the fiscal 2006, the Company has incurred certain restructuring, integration and other charges as
a result of the acquisition of Memec on July 5, 2005 (see Note 2), which is discussed further under Memec-
related restructuring, integration and other charges. In addition, the Company has incurred restructuring and
other charges primarily relating to actions taken following the divestitures of certain TS business lines in the
Americas region, certain cost reduction actions taken by TS in the EMEA region and other items, which are
discussed further under Restructuring and other charges related to business divestitures and other actions. The
restructuring, integration and other charges incurred for all of these activities totaled $69,960,000 pre-tax,
$49,870,000 after-tax and $0.34 per share on a diluted basis for fiscal 2006. The following table summarizes
the restructuring, integration and other charges incurred related to these broad groups of actions:
Year
Ended
July 1, 2006
(Thousands)
Memec-related including integration costs ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $53,456(1)
Business divestitures and other ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 16,504
Total restructuring, integration and other chargesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $69,960
(1) During fiscal 2006, $8,977,000 of the Memec-related charges was included in cost of sales in the
accompanying consolidated statements of operations.
Memec-related restructuring, integration and other charges
During fiscal 2006, the acquired Memec business was being integrated into the Company's existing EM
operations in all three regions. As a result of the acquisition integration efforts, the Company established and
approved plans to restructure certain of Avnet's existing operations to accommodate the integration of Memec
into Avnet.
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