Restructuring and Impairment Charges

3 Months Ended

Jun. 30, 2013

Restructuring and Impairment Charges [Abstract]

Restructuring and Impairment Charges

Note 5: Restructuring and Impairment Charges

During fiscal 2013, the Company announced its intention to restructure its Europe segment.  The Company’s actions included exiting certain non-core product lines based on its global product strategy, reducing manufacturing costs, implementing headcount reductions, and disposing of and selling certain underperforming or non-strategic assets.  The Company is continuing to evaluate additional restructuring actions in the Europe segment.  The restructuring is designed to align the cost structure of the segment with the segment’s strategic focus on the commercial vehicle, off-highway and engine products markets, while improving gross margin and return on average capital employed.

Since the commencement of the Europe segment restructuring, the Company recorded $24.1 million of asset impairment charges, $15.1 million of employee severance costs, primarily related to headcount reductions at the segment headquarters and a manufacturing facility, and $4.6 million of repositioning expenses, primarily related to accelerated depreciation for production equipment that will no longer be used because of planned manufacturing process changes at a facility in Germany and equipment transfer costs.

The Company accrues severance in accordance with its written plans, procedures and relevant statutory requirements.  Changes in accrued severance related to the Europe segment restructuring program were as follows:

	Three months ended June 30,
	2013				2012
Beginning Balance		$	11.6			$	-
Additions			0.3				4.5
Payments			(0.6	)			(0.2	)
Effect of exchange rate changes			0.1				-
Balance, June 30		$	11.4			$	4.3

Restructuring and repositioning expenses related to the Europe segment restructuring program were as follows:

	Three months ended June 30,
	2013			2012
Employee severance and related benefits		$	0.3		$	4.5
Accelerated depreciation			2.2			-
Other repositioning costs			0.2			0.1
Total restructuring and repositioning expenses		$	2.7		$	4.6

Total restructuring and repositioning costs were recorded in the consolidated statement of operations for the three months ended June 30, 2013 as follows: $2.2 million was recorded within cost of sales and $0.5 million was recorded as restructuring expenses.  Total restructuring and other repositioning costs were recorded in the consolidated statement of operations for the three months ended June 30, 2012 as restructuring expenses.