RESTRUCTURING

Masterbatch Reorganization Plan

In August 2012, the Company conducted an extensive evaluation of its three regional segments and specifically focused on each region's masterbatch product family. As a result of this evaluation, the Company realigned its regional masterbatch product family to put greater focus on its growth opportunities. Therefore, within each regional segment, effective September 1, 2012 the masterbatch product family was split into two separate product families, Custom Performance Colors and Masterbatch Solutions. As part of this plan, the Company reduced headcount in the EMEA and APAC regions in the fourth quarter of fiscal 2012. The Company recorded $2.3 million of pretax employee-related restructuring costs in fiscal 2012, of which the majority was related to the EMEA segment. As of August 31, 2012, the Company has a balance of $2.2 million accrued related to the EMEA segment for employee-related costs and expects minimal charges related to this plan to be recognized in fiscal 2013 as it completes the plan.

EMEA Operations and Back-Office Plan

In November 2011, the Company initiated a restructuring plan of EMEA's operations and back-office functions to better leverage savings from its Shared Service Center located in Belgium. As part of this plan, the Company reduced headcount in EMEA by approximately 50, and the majority of the reductions occurred in the first and second quarters of fiscal 2012. The Company recorded $4.7 million of pretax employee-related restructuring costs in fiscal 2012. As of August 31, 2012, the Company has a balance of $0.5 million accrued for employee-related costs related to this plan. The Company expects minimal charges related to this plan to be recognized in fiscal 2013 as it completes the plan.

Americas Engineered Plastics Plan

On August 25, 2011, the Company announced that it would close the Nashville, Tennessee facility and move certain production to the Akron and Bellevue, Ohio facilities in order to optimize the use of existing capacity and capitalize on growth opportunities. As of the end of February 2012, the Nashville facility ceased production and as of August 31, 2012, the Company reduced headcount by approximately 70. The Company recorded $1.6 million and $1.1 million of pretax employee-related restructuring expense associated with this plan during fiscal 2012 and 2011, respectively. As of August 31, 2012, the Company has a balance of $0.4 million accrued for employee-related costs related to this plan. The Company anticipates recognizing additional pretax employee-related cash charges and other restructuring expenses of less than $0.5 million during fiscal 2013 as it completes the plan.

Italy and Australia Plans

On February 8, 2011, the Company announced that it is relocating its operations from its manufacturing facility in Verolanuova, Italy to its existing facility in Gorla Maggiore, Italy. Production lines at the Verolanuova facility were relocated in the first quarter of fiscal 2012 to the Gorla facility. As a result of this relocation, the Company reduced headcount by approximately 30 in the fourth quarter of fiscal 2012. Also on February 8, 2011, as a result of the ongoing deterioration of the Australian rotomolding market, the Company announced plans to consolidate operations in Australia by moving production from its Braeside, Australia facility to its Brisbane, Australia facility. As part of this consolidation, the Company reduced headcount in Australia by approximately 20, and the majority of the reduction occurred in the second and third quarters of fiscal 2011. The region continues to be served by the Company’s Brisbane facility and facilities in Malaysia, Indonesia and China.

The Company recorded pretax restructuring expense of $0.5 million during fiscal 2012 primarily related to other restructuring costs as part of the Italy plan. In fiscal 2011, the Company recorded pretax restructuring expense of $6.0 million primarily for employee-related costs and other restructuring costs related to the Australia and Italy restructuring plans. As of August 31, 2012, the Company has no remaining accrual related to the Italy plan as it is considered complete. As of August 31, 2012, the Company has a balance of $0.3 million accrued for the Australia plan related to a future settlement of a contractual obligation and expects no additional charges related to this plan.

ASI United Kingdom Plan

On August 31, 2010, management announced plans to restructure its operations at its Crumlin, South Wales (U.K.) facility. The plan included moving part of the plant’s capacity to two other, larger facilities in Europe, and several production lines were shut down. As a result, the Company reduced headcount at this location by approximately 30. Approximately half of the reductions occurred in the second quarter of fiscal 2011 and the remaining headcount reductions occurred in the second quarter of fiscal 2012. The Company recorded minimal charges in fiscal 2012, and $0.1 million and $0.4 million of pretax employee-related restructuring costs during fiscal 2011 and 2010, respectively. The Company expects no further charges and has no remaining accrual as of August 31, 2012 related to this plan as it is considered complete.

ICO Merger Plan

In conjunction with the acquisition of ICO in fiscal 2010, the Company reduced the workforce in the Houston, Texas office by 17 employees. ICO had preexisting arrangements regarding change-in-control payments and severance pay which were based on pre-merger service. The Company assumed $2.1 million in liabilities as a result of the merger related to these agreements, of which $2.0 million was paid by the Company during fiscal 2010. Since the merger, the Company announced the exit of certain senior managers in Europe in connection with the Company’s ongoing integration of ICO operations. The Company recorded $0.5 million primarily in pretax employee-related costs during fiscal 2011 and minimal charges in fiscal 2010 related to the integration of the ICO merger. The Company had no charges in fiscal 2012 and has no remaining accrual as of August 31, 2012 related to this plan as it is considered complete.

North America Masterbatch Fiscal 2010 Plan

On March 1, 2010, the Company announced the closure of its Polybatch Color Center located in Sharon Center, Ohio. The Company recorded $0.5 million of pretax restructuring expense during fiscal 2011 primarily for employee-related costs associated with the closure. Also, the Company recorded pretax restructuring expense of $1.3 million during fiscal 2010. The Company ceased production at the Polybatch Color Center on August 31, 2010, and sold the facility in June 2011. The Company had no charges in fiscal 2012 and has no remaining accrual as of August 31, 2012 related to this plan as it is considered complete.

Consolidated Restructuring Summary

The following table summarizes the activity during fiscal 2012 and 2011 related to the Company’s restructuring plans:



	Accrual Balance August 31, 2010								Accrual Balance August 31, 2011							Accrual Balance August 31, 2012
	Accrual Balance August 31, 2010			Fiscal 2011 Charges		Fiscal 2011 Paid			Accrual Balance August 31, 2011		Fiscal 2012 Charges		Fiscal 2012 Paid			Accrual Balance August 31, 2012
	(In thousands)
Employee-related costs	$	2,011		$	5,048	$	(3,737	)	$	3,322	$	7,581	$	(7,379	)	$	3,524
Other costs	267			3,069		(2,933		)	403		1,675		(1,697		)	381
Translation effect	(47		)	—		—			70		—		—			(539		)
Restructuring charges	$	2,231		$	8,117	$	(6,670	)	$	3,795	$	9,256	$	(9,076	)	$	3,366

Restructuring costs are excluded from segment operating income but are attributable to the reportable segments as follows:



	Year Ended August 31,
	2012		2011		2010
	(In thousands)
EMEA	$	7,531	$	2,834	$	2,992
Americas	1,603		1,712		1,805
APAC	122		3,571		257
Total	$	9,256	$	8,117	$	5,054