Note 4: Restructuring

During 2010, we announced plans to restructure our coffee and fruit spreads operations as part of our ongoing efforts to enhance the long-term strength and profitability of our leading brands. Subsequent to 2010, we expanded our restructuring plans to include the Canadian pickle and condiments operations and the capacity expansion of our peanut and other nut butter businesses. During the third quarter of 2014, we decided to maintain natural peanut butter production at the New Bethlehem, Pennsylvania facility and continue utilizing third-party manufacturers for the production of our specialty nut butters. With the exception of natural peanut butter, the Memphis, Tennessee facility conversion to a peanut butter plant remains as planned. We expect to incur restructuring costs of approximately $265.0 for all of our restructuring plans, of which $244.7 has been incurred through January 31, 2014. The majority of the remaining costs are anticipated to be recognized through 2015.

Upon completion, the overall restructuring plan will result in a reduction of approximately 850 full-time positions. As of January 31, 2014, approximately 90 percent of the 850 full-time positions have been reduced and the impacted facilities have been closed, with the exception of the Ste. Marie, Quebec facility, which is anticipated to close in the fourth quarter of 2014.

The following table summarizes the restructuring activity, including the liabilities recorded and the total amount expected to be incurred.


	Long-Lived Asset Charges		Employee Separation		Site Preparation and Equipment Relocation		Production Start-up		Other Costs		Total
Total expected restructuring charge	$	102.8	$	64.2	$	45.6	$	42.2	$	10.2	$	265.0

Balance at May 1, 2012	$	—	$	8.8	$	—	$	—	$	—	$	8.8
Charge to expense		8.2		3.4		13.4		10.8		3.0		38.8
Cash payments		—		(4.5)		(13.4)		(10.8)		(3.0)		(31.7)
Noncash utilization		(8.2)		—		—		—		—		(8.2)

Balance at April 30, 2013	$	—	$	7.7	$	—	$	—	$	—	$	7.7
Charge to expense		2.7		2.6		5.5		5.5		0.8		17.1
Cash payments		—		(6.1)		(5.5)		(5.5)		(0.8)		(17.9)
Noncash utilization		(2.7)		(0.2)		—		—		—		(2.9)

Balance at January 31, 2014	$	—	$	4.0	$	—	$	—	$	—	$	4.0

Remaining expected restructuring charge	$	0.2	$	0.7	$	7.1	$	10.1	$	2.2	$	20.3

In the three and nine months ended January 31, 2014, total restructuring charges of $5.1 and $17.1, respectively, were reported in the Condensed Statements of Consolidated Income. Of the total restructuring charges, $1.6 and $5.1 were reported in cost of products sold in the three and nine months ended January 31, 2014, respectively, while the remaining charges were reported in other restructuring and merger and integration costs. In the three and nine months ended January 31, 2013, total restructuring charges of $5.4 and $30.1, respectively, were reported in the Condensed Statements of Consolidated Income. Of the total restructuring charges, $0.8 and $6.4 were reported in cost of products sold in the three and nine months ended January 31, 2013, respectively, while the remaining charges were reported in other restructuring and merger and integration costs. The restructuring costs classified as cost of products sold include plant start-up costs at the new facilities and long-lived asset charges for accelerated depreciation related to property, plant, and equipment that had been used at the affected production facilities prior to closure.

Employee separation costs include severance, retention bonuses, and pension costs. Severance costs and retention bonuses are recognized over the estimated future service period of the affected employees. The obligation related to employee separation costs is included in other current liabilities in the Condensed Consolidated Balance Sheets.

Other costs include professional fees, costs related to closing the facilities, and miscellaneous expenditures associated with the restructuring initiative and are expensed as incurred.