XML 29 R18.htm IDEA: XBRL DOCUMENT v2.4.0.8
Impairment and Restructuring Charges
 6 Months Ended
Jun. 30, 2013
Restructuring and Related Activities [Abstract]  
Impairment and Restructuring Charges
Note 12 - Impairment and Restructuring Charges

Impairment and restructuring charges by segment are comprised of the following:
 
For the three months ended June 30, 2013:
 
Mobile Industries
Total
Severance and related benefit costs
$
6.0

$
6.0

Exit costs
0.7

0.7

Total
$
6.7

$
6.7


For the three months ended June 30, 2012:
 
Mobile Industries
Process Industries
Total
Severance and related benefit costs
$
16.2

$
0.3

$
16.5

Exit costs
0.2

—

0.2

Total
$
16.4

$
0.3

$
16.7


For the six months ended June 30, 2013:
 
Mobile Industries
Process Industries
Total
Severance and related benefit costs
$
6.8

$
0.2

$
7.0

Exit costs
0.9

—

0.9

Total
$
7.7

$
0.2

$
7.9


For the six months ended June 30, 2012:
 
Mobile Industries
Process Industries
Total
Severance expense and related benefit costs
$
16.3

$
0.3

$
16.6

Exit costs
0.3

—

0.3

Total
$
16.6

$
0.3

$
16.9



The following discussion explains the impairment and restructuring charges recorded for the periods presented; however, it is not intended to reflect a comprehensive discussion of all amounts in the tables above.

Mobile Industries

In May 2012, the Company announced the closure of its manufacturing facility in St. Thomas, Ontario, Canada (St. Thomas), which was expected to be completed in approximately one year, and was intended to consolidate bearing production at this plant with its existing U.S. operations to better align the Company's manufacturing footprint and customer base. The Company also moved customer service for the Canadian market to its offices in Toronto. The Company completed the closure of this manufacturing facility on March 31, 2013. The closure of the St. Thomas manufacturing facility displaced 190 employees. The Company expects to incur pretax costs of approximately $55 million to $65 million in connection with this closure, of which approximately $20 million to $25 million is expected to be pretax cash costs.





The Company has incurred pretax costs related to this closure of approximately $38.9 million as of June 30, 2013, including rationalization costs recorded in cost of products sold. During the second quarter of 2013, the Company recorded $5.5 million of severance and related benefits, including pension settlement charges of $5.2 million. During the first six months of 2013, the Company recorded $6.3 million of severance and related benefits related to this closure. During the second quarter of 2012, the Company recorded $16.5 million of severance and related benefits, including a curtailment of pension benefits of $10.7 million.

In March 2007, the Company announced the closure of its manufacturing facility in Sao Paulo, Brazil (Sao Paulo). The Company completed the closure of this manufacturing facility on March 31, 2010. Pretax costs associated with the closure could be as high as approximately $60 million, which includes restructuring costs and rationalization costs recorded in cost of products sold and selling, general and administrative expenses. Mobile Industries has incurred cumulative pretax costs of approximately $58.4 million as of June 30, 2013 related to this closure. During the first six months of 2012, the Company recorded $2.9 million of exit costs associated with the closure of this facility, primarily related to environmental remediation costs. The Company accrues environmental remediation costs when they are probable and estimable.

The following is a rollforward of the consolidated restructuring accrual for the six months ended June 30, 2013 and the twelve months ended December 31, 2012:
 
June 30,
2013
December 31,
2012
Beginning balance, January 1
$
17.6

$
21.8

Expense
2.7

12.2

Payments
(8.3
)
(16.4
)
Ending balance
$
12.0

$
17.6



The restructuring accrual at June 30, 2013 and December 31, 2012 was included in other current liabilities on the Consolidated Balance Sheets. The restructuring accrual at June 30, 2013 excluded costs related to the settlement of pension benefit plans of $5.2 million. The restructuring accrual at June 30, 2013 included $4.8 million of environmental remediation costs, of which $3.9 million relates to Sao Paulo. The Company adjusts environmental remediation accruals based on the best available estimate of costs to be incurred, the timing and extent of remedial actions required by governmental authorities and the amount of the Company's liability in proportion to other responsible parties. The Company's estimated total liability for this site ranges from a minimum of $3.9 million to a maximum of $7.7 million. It is possible that the estimates may change in the near term.