Exit and Disposal Activities

6 Months Ended

Jul. 04, 2015

Restructuring and Related Activities [Abstract]

Exit and Disposal Activities

Note 6: Exit and Disposal Activities

Snap-on did not record any costs for exit and disposal activities in the three and six month periods ended July 4, 2015; in the three and six month periods ended June 28, 2014, Snap-on recorded costs for exit and disposal activities for the Repair Systems & Information Group as follows:

	Three Months Ended		Six Months Ended
(Amounts in millions)	June 28, 2014		June 28, 2014
Exit and disposal costs:
Repair Systems & Information Group:
Cost of goods sold	$	1.2	$	3.2
Operating expenses		0.2		0.2
Total exit and disposal costs	$	1.4	$	3.4

The $1.4 million and $3.4 million of costs incurred during the respective three and six month periods ended June 28, 2014, qualified for accrual treatment.

Snap-on’s exit and disposal accrual activity for the first and second quarters of 2015 is as follows:

	Balance at January  3, 2015		First Quarter				Balance at April  4, 2015		Second Quarter				Balance at July  4, 2015
(Amounts in millions)			Provision		Usage				Provision		Usage
Severance costs:
Commercial & Industrial Group	$	0.8	$	–	$	(0.3)	$	0.5	$	–	$	(0.1)	$	0.4
Repair Systems & Information Group		5.7		–		(0.4)		5.3		–		(0.6)		4.7
Total	$	6.5	$	–	$	(0.7)	$	5.8	$	–	$	(0.7)	$	5.1

As of July 4, 2015, the company expects that approximately $1.8 million of the $5.1 million exit and disposal accrual will be utilized in the balance of 2015 and the remainder will extend into 2016 primarily for longer-term severance obligations.

Snap-on expects to fund the remaining cash requirements of its exit and disposal activities with available cash on hand, cash flows from operations and borrowings under the company’s existing credit facilities. The estimated costs for the exit and disposal activities were based on management’s best business judgment under prevailing circumstances.