RESTRUCTURING AND RELATED CHARGES

In the fourth quarter of fiscal 2017, our Board of Directors approved a multi-year restructuring program (the “Financial Fitness Program”), which is expected to contribute to the Company’s overall strategy of financial fitness through increased operational effectiveness and overhead reduction. The Company currently anticipates the Financial Fitness Program will result in cumulative pretax charges, once implemented, of approximately $253 million which consist primarily of severance and employee related costs, impairments and accelerated depreciation of technology assets, incremental costs to implement new technology, and contract termination costs. In the second quarter of fiscal 2018, we increased the total cumulative pretax charge estimate by $35 million due to revisions in scope and timing related to implementation of new technology. The majority of this increase is expected to be incurred in fiscal 2019. As part of this program, we anticipate eliminating approximately 550 positions across several areas and job levels with most of the eliminated positions originating from the corporate offices in Springdale, Arkansas; Chicago, Illinois; and Cincinnati, Ohio. For the three and six months ended March 31, 2018, the Company recognized restructuring and related charges of $12 million and $31 million associated with the Financial Fitness Program, respectively.

The following table reflects the pretax impact of restructuring and related charges in our Consolidated Condensed Statements of Income:



in millions
	Three Months Ended		Six Months Ended
	March 31, 2018		March 31, 2018
Cost of Sales	$	—	$	—
Selling, General and Administrative expenses	12		31
Total restructuring and related charges, pretax	$	12	$	31

The following table reflects the pretax impact of restructuring and related charges incurred in the three and six months ended March 31, 2018, the program charges to date and the total estimated program charges, by our reportable segments:



							in millions
	Three Months Ended		Six Months Ended		Financial Fitness Program charges to date
	March 31, 2018		March 31, 2018		March 31, 2018		Total estimated Financial Fitness Program charges
Beef	$	1	$	2	$	10	$	18
Pork	—		1		4		7
Chicken	6		15		71		102
Prepared Foods	5		13		95		125
Other	—		—		1		1
Total restructuring and related charges, pretax	$	12	$	31	$	181	$	253

For the three and six months ended March 31, 2018, the restructuring and related charges consisted of $1 million and $4 million of severance and employee related costs, respectively, and $11 million and $27 million of technology related costs, respectively. The majority of the remaining estimated charges are related to incremental costs to implement new technology and accelerated depreciation of technology assets.

The following table reflects our liability related to restructuring charges which were recognized in other current liabilities in our Consolidated Condensed Balance Sheets as of March 31, 2018:



in millions
	Liability as of September 30, 2017		Restructuring charges		Payments		Other		Liability as of March 31, 2018
Severance and employee related costs	$	47	$	4	$	24	$	—	$	27
Contract termination	22		—		19		—		3
Total	$	69	$	4	$	43	$	—	$	30