RESTRUCTURING ACTIVITIES

Supply Chain and Administrative Efficiency Plan

We are continuing to evaluate a plan for the integration of Ralcorp and related restructuring activities. On February 14, 2014, our Board of Directors approved an expansion of the scope of the plan we previously referred to as the Ralcorp Related Restructuring Plan to include steps to optimize and improve selling, general and administrative effectiveness and efficiencies (“SG&A initiatives”). The Supply Chain and Administrative Efficiency Plan (the “SCAE Plan”) includes these SG&A initiatives and the previously announced initial phase of the SCAE Plan (the “Initial Phase”) addressing the entire organization's supply chain network. Although we remain unable to make good faith estimates relating to the entire SCAE Plan, we are reporting on actions included in the SCAE Plan. This reporting addresses the estimated amounts or range of amounts for each major type of cost expected to be incurred, and the charges that have or will result in cash outflows. In connection with the SCAE Plan, we expect to incur approximately $280.0 million of charges, which includes $254.5 million of cash charges and $25.5 million of non-cash charges.

We anticipate that we will recognize the following pre-tax expenses associated with the SCAE Plan (amounts include charges recognized in fiscal year 2013 and the first three quarters of fiscal year 2014):



	Consumer Foods		Corporate		Private Brands		Total
Multi-employer pension costs	$	—	$	11.2	$	—	$	11.2
Other cost of goods sold	0.5		—		0.9		1.4
Total cost of goods sold	$	0.5	$	11.2	$	0.9	$	12.6
Severance and related costs	$	1.5	$	113.9	$	9.5	$	124.9
Accelerated depreciation	—		1.9		19.0		20.9
Fixed asset impairment / Loss on disposal	—		—		3.4		3.4
Other selling, general and administrative expenses	0.6		27.0		90.6		118.2
Total selling, general and administrative expenses	$	2.1	$	142.8	$	122.5	$	267.4
Consolidated total	$	2.6	$	154.0	$	123.4	$	280.0

During the third quarter of fiscal 2014, we recognized the following pre-tax expenses for the SCAE Plan:



	Consumer Foods		Corporate		Private Brands		Total
Cost of goods sold	$	0.3	$	—	$	0.2	$	0.5
Severance and related costs	$	0.8	$	0.8	$	9.3	$	10.9
Asset impairment	—		—		3.4		3.4
Accelerated depreciation	—		0.1		6.6		6.7
Other selling, general and administrative expenses	—		1.1		0.9		2.0
Total selling, general and administrative expenses	$	0.8	$	2.0	$	20.2	$	23.0
Consolidated total	$	1.1	$	2.0	$	20.4	$	23.5

During the first three quarters of fiscal 2014, we recognized the following pre-tax expenses for the SCAE Plan:



	Consumer Foods		Corporate		Private Brands		Total
Cost of goods sold	$	0.5	$	—	$	0.2	$	0.7
Severance and related costs	$	1.4	$	14.1	$	9.3	$	24.8
Asset impairment	—		—		3.4		3.4
Accelerated depreciation	—		0.1		6.6		6.7
Other selling, general and administrative expenses	—		1.4		1.1		2.5
Total selling, general and administrative expenses	$	1.4	$	15.6	$	20.4	$	37.4
Consolidated total	$	1.9	$	15.6	$	20.6	$	38.1

We recognized the following cumulative (plan inception to February 23, 2014) pre-tax expenses related to the SCAE Plan in our Condensed Consolidated Statement of Earnings:



	Consumer Foods		Corporate		Private Brands		Total
Multi-employer pension costs	$	—	$	11.2	$	—	$	11.2
Other cost of goods sold	0.5		—		0.2		0.7
Total cost of goods sold	$	0.5	$	11.2	$	0.2	$	11.9
Severance and related costs	$	1.4	$	31.3	$	9.3	$	42.0
Asset impairment	—		—		3.4		3.4
Accelerated depreciation	—		0.1		6.6		6.7
Other selling, general and administrative expenses	—		1.4		1.1		2.5
Total selling, general and administrative expenses	$	1.4	$	32.8	$	20.4	$	54.6
Consolidated total	$	1.9	$	44.0	$	20.6	$	66.5

Liabilities recorded for the SCAE Plan and changes therein for the first three quarters of fiscal 2014 were as follows:



	Balance at May 26, 2013		Costs Incurred and Charged to Expense		Costs Paid or Otherwise Settled			Balance at February 23, 2014
Severance	$	17.2	$	24.8	$	(19.1	)	$	22.9
Multi-employer pension and other costs	11.2		3.2		(1.1		)	13.3
Total	$	28.4	$	28.0	$	(20.2	)	$	36.2

Acquisition-related Restructuring Costs

During fiscal 2012, we started incurring costs in connection with actions taken to attain synergies when integrating businesses acquired prior to the third quarter of fiscal 2013. These costs, collectively referred to as "acquisition-related restructuring costs", include severance and other costs associated with consolidating facilities and administrative functions. In connection with the acquisition-related restructuring costs, we incurred pre-tax cash and non-cash charges of $19.7 million ($17.2 million in the Consumer Foods segment and $2.5 million in Corporate expenses) cumulatively since inception. In the third quarter and first three quarters of fiscal 2014, we incurred $2.4 million and $5.7 million, respectively, in the Consumer Foods segment, primarily representing impairment of equipment. In the third quarter and first three quarters of fiscal 2013, we recognized charges of $4.4 million and $8.4 million, respectively, in relation to the acquisition-related restructuring costs. The acquisition-related restructuring costs will be substantially complete by the end of fiscal 2014.

Administrative Efficiency Plan

In August 2011, we made a decision to reorganize our Consumer Foods sales function and certain other administrative functions within our Commercial Foods and Corporate reporting segments. These actions, collectively referred to as the "Administrative Efficiency Plan", were intended to improve the efficiency and effectiveness of the affected sales and administrative functions. In connection with the Administrative Efficiency Plan, we have incurred pre-tax cash and non-cash charges of $18.7 million ($13.8 million in the Consumer Foods segment, $1.0 million in the Commercial Foods segment, and $3.9 million in Corporate expenses), primarily for severance and costs of employee relocation. In the third quarter and first three quarters of fiscal 2013, we recognized charges of $0.3 million and $1.8 million, respectively, in relation to the Administrative Efficiency Plan. At the end of fiscal 2013, the Administrative Efficiency Plan was substantially complete.

Network Optimization Plan

During the third quarter of fiscal 2011, our Board of Directors approved a plan designed to optimize our manufacturing and distribution networks. We refer to this plan as the "Network Optimization Plan". The Network Optimization Plan consists of projects that involve, among other things, the exit of certain manufacturing facilities, the disposal of underutilized manufacturing assets, and actions designed to optimize our distribution network. In connection with the Network Optimization Plan, we have incurred pre-tax cash and non-cash charges of $76.7 million ($59.9 million in the Consumer Foods segment, $16.0 million in the Commercial Foods segment, and $0.8 million in Corporate expenses), primarily for impairments of property, plant and equipment, accelerated depreciation, severance and related costs, and plan implementation costs (e.g., consulting and employee relocation). In the third quarter and first three quarters of fiscal 2013, we recognized a benefit of $0.3 million and charges $4.2 million, respectively, in relation to the Network Optimization Plan. At the end of fiscal 2013, the Network Optimization Plan was substantially complete.

Ralcorp Pre-acquisition Restructuring Plans

At the time of its acquisition, Ralcorp had certain initiatives underway designed to optimize its manufacturing and distribution networks. We refer to these actions and the related costs as "Ralcorp Pre-acquisition Restructuring Plans". These plans consisted of projects that involved, among other things, the exit of certain manufacturing facilities. We expect to incur $4.6 million of charges that have resulted or will result in cash outflows of $2.8 million and non-cash charges of $1.8 million associated with the Ralcorp Pre-acquisition Restructure Plans. We have recognized cumulative (plan inception to February 23, 2014) pre-tax expenses of $4.4 million related to the Ralcorp Pre-acquisition Restructuring Plans. In the third quarter and first three quarters of fiscal 2014, we recognized charges of $0.5 million and $3.1 million, respectively. In the third quarter and first three quarters of fiscal 2013, we recognized charges of $0.7 million.