NOTE 15 – RESTRUCTURING

In fiscal year 2012, we exited the gelcoat products market and initiated the consolidation of a manufacturing facility in our Paints segment. Our gelcoat product line was categorized in All Other. During the 2011 fiscal year, we initiated restructuring actions in our Coatings segment, primarily in our wood product line, which further rationalized our manufacturing capacity and reduced our overall global headcount. We also initiated restructuring actions to improve the profitability of our Australian acquisition in our Paints segment, which included facility consolidations in manufacturing and distribution, store rationalization and other related costs.

These restructuring activities were completed in 2012 and resulted in pre-tax charges of $25,845 or $0.18 per share after tax and $33,093 or $0.24 per share after tax in fiscal years 2012 and 2011, respectively.

In fiscal year 2008, we initiated a comprehensive series of restructuring activities that were completed in fiscal year 2011. These restructuring initiatives included plant closures, reductions to research and development and selling, general and administrative expenses, manufacturing consolidation and relocation, and our exit from non-strategic product lines in certain geographies. We rationalized our manufacturing capacity and reduced our overall global headcount to lower our costs in light of the challenging global economic conditions. Pre-tax restructuring charges for these initiatives were $1,346 or $0.01 per share after tax and $12,383 or $0.08 per share after tax in fiscal years 2011 and 2010, respectively.

The total resulting expenses recognized in fiscal year 2012, 2011 and 2010 included severance and employee benefits, asset impairments, professional services and site clean-up. We plan to pay the majority of the current restructuring liabilities within the next six months.

The following restructuring charges by segment were recorded in 2012, 2011 and 2010:


For the Year Ended October 26, 2012	Liability Beginning Balance 10/28/2011		Expense		Activity			Liability Ending Balance 10/26/2012
Coatings
Severance and employee benefits	$	3,884	$	545	$	(2,195	)	$	2,234
Asset impairments		—		658		(658	)		—
Exit costs (consulting/site clean-up)		2,802		215		(2,627	)		390
Total Coatings		6,686		1,418		(5,480	)		2,624
Paints
Severance and employee benefits		2,915		5,544		(6,355	)		2,104
Asset impairments		—		7,447		(7,447	)		—
Exit costs (consulting/site clean-up)		408		5,401		(1,825	)		3,984
Total Paints		3,323		18,392		(15,627	)		6,088
All Other
Severance and employee benefits		437		1,551		(1,691	)		297
Asset impairments		—		3,616		(3,616	)		—
Exit costs (consulting/site clean-up)		—		868		(868	)		—
Total All Other		437		6,035		(6,175	)		297
Total	$	10,446	$	25,845	$	(27,282	)	$	9,009


For the Year Ended October 28, 2011	Liability Beginning Balance 10/29/2010		Expense		Activity			Liability Ending Balance 10/28/2011
Coatings
Severance and employee benefits	$	1,139	$	10,044	$	(7,299	)	$	3,884
Asset impairments		—		5,644		(5,644	)		—
Exit costs (consulting/site clean-up)		2,034		5,252		(4,484	)		2,802
Total Coatings		3,173		20,940		(17,427	)		6,686
Paints
Severance and employee benefits		19		7,945		(5,049	)		2,915
Asset impairments		—		4,169		(4,169	)		—
Exit costs (consulting/site clean-up)		2,763		899		(3,254	)		408
Total Paints		2,782		13,013		(12,472	)		3,323
All Other
Severance and employee benefits		—		486		(49	)		437
Total All Other		—		486		(49	)		437
Total	$	5,955	$	34,439	$	(29,948	)	$	10,446


For the Year Ended October 29, 2010	Liability Beginning Balance 10/30/2009		Net Expense			Activity			Liability Ending Balance 10/29/2010
Coatings
Severance and employee benefits	$	1,694	$	2,353		$	(2,908	)	$	1,139
Asset impairments		—		5,596			(5,596	)		—
Exit costs (consulting/site clean-up)		1,012		1,822			(800	)		2,034
Contract term costs (leases)		—		792			(792	)		—
Total Coatings		2,706		10,563			(10,096	)		3,173
Paints
Severance and employee benefits		827		313			(1,121	)		19
Asset impairments		—		(237	)		237			—
Exit costs (consulting/site clean-up)		2,556		1,519			(1,312	)		2,763
Total Paints		3,383		1,595			(2,196	)		2,782
All Other
Severance and employee benefits		55		—			(55	)		—
Asset impairments		—		114			(114	)		—
Exit costs (consulting/site clean-up)		—		111			(111	)		—
Total All Other		55		225			(280	)		—
Total	$	6,144	$	12,383		$	(12,572	)	$	5,955

The ending liability balance at October 26, 2012, October 28, 2011 and October 29, 2010 is included in other accrued liabilities on our Consolidated Balance Sheets. The restructuring reserve balances presented are considered adequate to cover committed restructuring actions. The restructuring expenses recorded are included in the Consolidated Statements of Operations. For 2012, $16,199 was charged to cost of sales and $9,646 was charges to selling, general and administrative (SG&A) expense. For 2011, $25,563 was charged to cost of sales and $8,876 was charged to SG&A expenses. For 2010, $12,520 was charged to cost of sales and $137 was credited to SG&A expenses.

In 2010, we also recorded $6,147 of restructuring charges consisting primarily of severance related to the divestiture of certain assets to DIC Corporation, which was netted against the gain included in SG&A expenses in our Coatings segment.