Jack In The Box 2014 Annual Report Download - page 65
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Restructuring costs — Since the beginning of 2012, we have been engaged in a comprehensive review of our organization structure, including evaluating
opportunities for outsourcing, restructuring of certain functions and workforce reductions. The following is a summary of the costs incurred in connection
with these activities during each fiscal year (in thousands):
Enhanced pension benefits
$ —
$ —
$ 6,167
Severance costs
2,141
2,821
6,987
Other
6,480
630
2,307
$ 8,621
$ 3,451
$ 15,461
In 2014, other relates to the impairment of a restaurant software asset we no longer plan to place in service as a result of our efforts to integrate certain systems
across both of our brands and lower costs. In fiscal 2012, as part of these cost saving initiatives, we offered a voluntary early retirement program (“VERP”) to
eligible employees which are noted as enhanced pension benefits in the table above. Refer to Note 11, Retirement Plans, for additional information regarding
the costs associated with enhanced pension benefits in fiscal 2012.
Total accrued severance costs related to our restructuring activities are included in accrued liabilities in the accompanying consolidated balance sheets and
changed as follows in each fiscal year (in thousands):
Balance at beginning of year
$ 253
$ 1,758
Additions
2,141
2,821
Cash payments
(1,857)
(4,326)
Balance at end of the year
$ 537
$ 253
We expect to incur additional charges related to our restructuring activities; however, we are unable to make a reasonable estimate of the additional costs at
this time. Our continuing efforts to lower our cost structure include identifying opportunities to reduce general and administrative costs as well as improve
restaurant profitability across both brands.
Income taxes consist of the following in each fiscal year (in thousands):
Current:
Federal
$ 43,864
$ 51,367
$ 35,205
State
3,770
7,583
5,248
47,634
58,950
40,453
Deferred:
Federal
3,700
(16,897)
(5,553)
State
452
(1,707)
(1,062)
4,152
(18,604)
(6,615)
Income tax expense from continuing operations
$ 51,786
$ 40,346
$ 33,838
Income tax benefit from discontinued operations
$ (3,629)
$ (19,566)
$ (6,651)
A reconciliation of the federal statutory income tax rate to our effective tax rate for continuing operations is as follows:
Computed at federal statutory rate
35.0%
35.0%
35.0%
State income taxes, net of federal tax benefit
3.3
3.4
3.3
Benefit of jobs tax credits, net of valuation allowance
(1.2)
(1.9)
(1.0)
Benefit related to COLIs
(1.6)
(2.9)
(4.6)
Other, net
(0.2)
(0.8)
0.5
35.3%
32.8%
33.2%
F-21