Graco 2012 Annual Report Download - page 70

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64
further simplify and align the business around two key activities – Brand & Category Development and Market Execution &
Delivery. As part of the expanded program, the Company's Consumer and Professional groups were eliminated and the Company's
nine global business units are being streamlined into six business segments. In connection with the expansion, the Company
expects to incur incremental cash costs of $225 to $250 million, approximately 80% of which are employee-related cash costs,
including severance, retirement, and other termination benefits and costs. The Company also expects to record incremental pretax
restructuring charges in the range of $250 to $275 million over the same period. Cumulative pretax costs of the expanded Project
Renewal are expected to be $340 to $375 million, with cash costs of $300 to $340 million. Project Renewal is expected to be
completed by mid-2015.
The following table depicts the restructuring charges incurred in connection with Project Renewal for the year ended December
31, (in millions):
2012 2011
Since Inception
Through
December 31,
2012
Facility and other exit costs, including impairments $ (0.7) $ 8.4 $ 7.7
Employee severance, termination benefits and relocation costs 29.2 18.3 47.5
Exited contractual commitments and other 8.8 4.5 13.3
$ 37.3 $ 31.2 $ 68.5
Restructuring provisions were determined based on estimates prepared at the time the restructuring actions were approved by
management, are periodically updated for changes and also include amounts recognized as incurred. The following table depicts
the activity in accrued restructuring reserves for Project Renewal for 2012 and 2011 (in millions):
December 31,
2011 December 31,
2012
Balance Provision Costs Incurred Balance
Facility and other exit costs, including impairments $ — $ (0.7) $ 0.7 $ —
Employee severance, termination benefits and relocation costs 11.2 29.2 (21.4) 19.0
Exited contractual commitments and other 4.5 8.8 (9.0) 4.3
$ 15.7 $ 37.3 $ (29.7) $ 23.3
December 31,
2010 December 31,
2011
Balance Provision Costs Incurred Balance
Facility and other exit costs, including impairments $ — $ 8.4 $ (8.4) $ —
Employee severance, termination benefits and relocation costs — 18.3 (7.1) 11.2
Exited contractual commitments and other — 4.5 — 4.5
$ — $ 31.2 $ (15.5) $ 15.7
The following table depicts the activity in accrued restructuring reserves for Project Renewal for 2012 and 2011 aggregated by
reportable business segment (in millions):
December 31,
2011 December 31,
2012
Segment Balance Provision Costs Incurred Balance
Home Solutions $ 7.1 $ 7.6 $ (6.2) $ 8.5
Writing 1.4 2.4 (3.1) 0.7
Tools — 1.0 (0.8) 0.2
Commercial Products — 5.6 (4.2) 1.4
Baby & Parenting 2.0 0.9 (2.0) 0.9
Specialty 2.4 3.4 (3.1) 2.7
Corporate 2.8 16.4 (10.3) 8.9
$ 15.7 $ 37.3 $ (29.7) $ 23.3