Circuit City 2004 Annual Report Download - page 52

Download and view the complete annual report

Please find page 52 of the 2004 Circuit City 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 64

  • 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

------ ---- --- ------
Accrued at December 31, 2004 $633 $ - $12 $645
==== ==== === ====
Severance and Other
Personnel Costs Exit Costs Total
--------------- ---------- -----
Accrued at December 31, 2003 $ 63 $650 $713
Charged to expense in 2004 642 642
Amounts utilized (63) (659) (722)
--- ---- ----
Accrued at December 31, 2004 $ - $633 $633
=== ==== ====
Other
Exit Costs
----------
Accrued at December 31, 2003 $2,312
Charged to expense in 2004 467
Amounts utilized (2,028)
------
Accrued at December 31, 2004 $751
====
55
2003 United States Warehouse Consolidation Plan
In the fourth quarter of 2003, the Company implemented a plan to consolidate the warehousing facilities in its
United States computer supplies business. In 2004 the Company recorded $642,000 of additional exit costs
related to this plan. The table below displays the activity and liability balance of the reserve for this initiative (in
thousands):
2002 United Kingdom Consolidation Plan
In 2002 the Company implemented a restructuring plan to consolidate the activities of three United Kingdom
locations into a new facility constructed for the Company. In the third quarter of 2004, the Company recorded
additional costs related to this plan. The table below displays the activity and liability balance of the reserve for
this initiative (in thousands):
Other severance and exit costs
During 2004, the Company recorded $2.5 million of restructuring costs in Europe in connection with facility exit
costs and workforce reductions, including a consolidation of United Kingdom sales offices in the first quarter of
2004, resulting in the elimination of 50 jobs. These costs were comprised of $1.4 million of employee severance
costs and $0.7 million of other exit costs, primarily asset write
-
downs.
During the second quarter of 2002 the Company recorded a non-recurring write-off of $13.2 million resulting
from its decision to discontinue the development of internal
-
use computer software.
In August 2003, the Company settled its litigation with a software developer and reversed a previously recorded
liability of $1.3 million which was no longer needed (See Note 10).
9.
SHAREHOLDERS' EQUITY
As required by law, certain foreign subsidiaries must retain a percentage of shareholders' capital in the respective
company. Accordingly, a portion of retained earnings is restricted and not available for distribution to
shareholders. Such amount at December 31, 2004 and 2003 was not material.