Restructuring, Acquisition and Integration-Related Costs

The Company incurs costs in connection with acquiring, integrating and restructuring acquisitions and in connection with its global cost-reduction/productivity initiatives. For example:

•

In connection with acquisition activity, the Company typically incurs costs associated with executing the transactions, integrating the acquired operations (which may include expenditures for consulting and the integration of systems and processes), and restructuring the combined company (which may include charges related to employees, assets and activities that will not continue in the combined company); and


•	In connection with the Company's cost-reduction/productivity initiatives, it typically incurs costs and charges associated with site closings and other facility rationalization actions and workforce reductions.

Restructuring, acquisition transaction and integration-related costs consisted of the following during the year ended December 31, 2013, 2012 and 2011, respectively (in thousands):



	2013			2012		2011
Cost of sales
Restructuring costs	$	36,949	(a)	14,816	(b)	17,546	(b)
Acquisition integration-related costs	12,202			—		—
Restructuring and integration-related costs	$	49,151		14,816		17,546

Selling, general and administrative expenses
Restructuring costs	$	32,540	(a)	3,748	(b)	5,663	(b)
Acquisition transaction-related costs	14,199			—		—
Acquisition integration-related costs	16,049			—		—
Restructuring, acquisition and integration-related costs	$	62,788		3,748		5,663

(a) The restructuring costs for 2013 primarily relate to the Company’s actions taken to lower its cost structure and improve efficiencies of manufacturing operations and administrative functions, as well as actions related to the Company's acquisition of Pergo, Marazzi and Spano.

(b) The restructuring costs for 2012 and 2011 primarily relate to the Company's actions taken to lower its cost structure and improve efficiencies of manufacturing and distribution operations as the Company adjusted to changing economic conditions.

In addition, $1,481 of acquisition and integration-related costs was recorded in other expense for the year ended December 31, 2013.

The restructuring activity for the twelve months ended December 31, 2013 and 2012, respectively is as follows (in thousands):



	Lease impairments			Asset write-downs		Severance		Other restructuring costs		Total
Balance as of December 31, 2011	$	10,956		—		2,378		1,511		14,845
Provision - Carpet segment	—			6,687		4,069		(252	)	10,504
Provision - Ceramic segment	373			3,727		2,009		—		6,109
Provision - Laminate and Wood segment	—			138		1,775		38		1,951
Cash payments	(3,872		)	—		(7,333	)	(1,297	)	(12,502	)
Non-cash items	—			(10,552	)	—		—		(10,552	)
Balance as of December 31, 2012	7,457			—		2,898		—		10,355
Provision - Carpet segment	1,320			1,024		10,777		708		13,829
Provision - Ceramic segment	—			777		9,372		11,210		21,359
Provision - Laminate and Wood segment	—			—		20,371		13,008		33,379
Provision - Corporate	—			—		922		—		922
Cash payments	(2,873		)	—		(26,196	)	(13,199	)	(42,268	)
Non-cash items	—			(1,801	)	—		(11,727	)	(13,528	)
Balance as of December 31, 2013	$	5,904		—		18,144		—		24,048

The Company expects the remaining lease impairments, severance and other restructuring costs to be paid over the next four years.