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Other Expenses | 12 Months Ended
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Dec. 31, 2012
Other Income and Expenses [Abstract] |
Other Expenses | Other Expenses During 2012, 2011 and 2010, the Company recorded pre-tax other expenses from continuing operations of $93.8 million, $102.7 million and $86.5 million, respectively. The major components of this income statement category are as follows:
|  | Other (Income) Expenses
(In thousands) |  | 2012 |  | 2011 |  | 2010
Net gains |  | $ | (5,848 | ) |  | $ | (6,162 | ) |  | $ | (7,792 | )
Contingent consideration adjustments |  | — |  |  | (3,966 | ) |  | (10,620 | )
Employee termination benefits costs |  | 31,158 |  |  | 36,174 |  |  | 24,816 |
Costs to exit activities |  | 38,626 |  |  | 10,007 |  |  | 34,384 |
Product line rationalization |  | 24,966 |  |  | 66,063 |  |  | 34,302 |
Impaired asset write-downs |  | 7,152 |  |  | — |  |  | 9,966 |
Other (income) expense |  | (2,278 | ) |  | 624 |  |  | 1,417 |
Total |  | $ | 93,776 |  |  | $ | 102,740 |  |  | $ | 86,473 |
Substantially all other expenses in 2012, 2011 and 2010 were incurred in conjunction with restructuring programs initiated within the Harsco Infrastructure Segment and the Harsco Metals & Minerals Segment in 2011 and the Harsco Infrastructure Segment in 2010. See Note 18, Restructuring Programs, for additional information on these programs. Net Gains Net gains result from the sales of redundant properties (primarily land, buildings and related equipment) and non-core assets. In 2012, gains related to assets sold principally in the United States. In 2011, gains related to assets sold principally in the United Kingdom and the United States. In 2010, gains related to assets sold principally in the United States and Western Europe.
|  | Net Gains
(In thousands) |  | 2012 |  | 2011 |  | 2010
Harsco Metals & Minerals Segment |  | $ | (2,449 | ) |  | $ | (1,666 | ) |  | $ | (3,942 | )
Harsco Infrastructure Segment |  | (2,198 | ) |  | (3,607 | ) |  | (3,253 | )
Harsco Industrial Segment |  | (1,089 | ) |  | (889 | ) |  | (597 | )
Corporate |  | (112 | ) |  | — |  |  | — |
Total |  | $ | (5,848 | ) |  | $ | (6,162 | ) |  | $ | (7,792 | )
Cash proceeds associated with these gains are included in proceeds from the sale of assets in the cash flows from investing activities section of the Consolidated Statements of Cash Flows. Contingent Consideration Adjustments Certain of the Company's acquisitions in prior years included contingent consideration features for which defined goals needed to be met by the acquired business in order for payment of the consideration. Each quarter until settlement of these contingencies, the Company assessed the likelihood that an acquired business would achieve the goals and the resulting fair value of the contingency. In accordance with accounting standards for business combinations, these adjustments were recognized in operating income (loss) from continuing operations in the Consolidated Statements of Operations as a component of the other expenses line item. The Company's assessment of these performance goals resulted in the following reductions to previously recognized contingent consideration liabilities:
|  | Contingent Consideration Adjustments
(In thousands) |  | 2012 |  | 2011 |  | 2010
Harsco Infrastructure Segment |  | $ | — |  |  | $ | (3,966 | ) |  | $ | (10,620 | )
All contingent consideration liabilities have been settled and there was no recorded contingent consideration liability as of December 31, 2012 and 2011. Employee Termination Benefit Costs Costs and the related liabilities associated with involuntary termination costs associated with one-time benefit arrangements provided as part of an exit or disposal activity are recognized by the Company when a formal plan for reorganization is approved at the appropriate level of management and communicated to the affected employees. Additionally, costs associated with ongoing benefit arrangements, or in certain countries where statutory requirements dictate a minimum required benefit, are recognized when they are probable and estimable. The total amount of employee termination benefit costs incurred during 2012, 2011 and 2010 is presented in the table below. The employee termination benefit costs in 2012 related primarily to the 2011/2012 Restructuring Program and were primarily in Western Europe, North America, the United Kingdom and the Asia-Pacific region. The employee termination benefits costs in 2011 related primarily to the 2011/2012 Restructuring Program and were primarily in Western Europe and the United Kingdom. The employee termination benefit costs in 2010 related primarily to the Fourth Quarter 2010 Harsco Infrastructure Program in addition to initiatives in the Harsco Metals & Minerals Segment and were primarily in the United Kingdom, Western Europe and North America.
|  | Employee Termination Benefit Costs
(In thousands) |  | 2012 |  | 2011 |  | 2010
Harsco Metals & Minerals Segment |  | $ | 8,082 |  |  | $ | 18,533 |  |  | $ | 4,684 |
Harsco Infrastructure Segment |  | 17,291 |  |  | 16,546 |  |  | 19,068 |
Harsco Rail Segment |  | 245 |  |  | 296 |  |  | 578 |
Harsco Industrial Segment |  | 418 |  |  | 423 |  |  | 486 |
Corporate |  | 5,122 |  |  | 376 |  |  | — |
Total |  | $ | 31,158 |  |  | $ | 36,174 |  |  | $ | 24,816 |
Costs to Exit Activities Costs associated with exit or disposal activities are recognized as follows:
• | Costs to terminate a contract that is not a capital lease are recognized when an entity terminates the contract or when an entity ceases using the right conveyed by the contract. This includes the costs to terminate the contract before the end of its term or the costs that will continue to be incurred under the contract for its remaining term without economic benefit to the entity (e.g., lease run-out costs).
• | Other costs associated with exit or disposal activities (e.g., costs to consolidate or close facilities and relocate equipment or employees) are recognized and measured at their fair value in the period in which the liability is incurred.
In 2012, $38.6 million of exit costs were incurred, principally related to Western Europe, the United States and the United Kingdom. This consists primarily of branch structure reduction and office rationalization costs in the Harsco Infrastructure and Harsco Metals & Minerals Segments. Costs to exit activities included $10.9 million of gains from currency translation adjustments recognized in earnings. The currency translation adjustments are non-cash items recognized when the Company has substantially liquidated its investment in a foreign entity. The Company exited certain countries and recognized such adjustment gains in conjunction with the Company's 2011/2012 Restructuring Program. In 2011, $10.0 million of exit costs were incurred, principally related to the United States, the United Kingdom and Western Europe. This consists primarily of branch structure reduction and office rationalization costs in the Harsco Infrastructure and Harsco Metals & Minerals Segments. In 2010, $34.4 million of exit costs were incurred, principally related to relocation and lease run-out costs in the Harsco Infrastructure Segment in the United States, Western Europe and the United Kingdom. Costs to exit activities in 2010 included $8.3 million of withdrawal liabilities to exit certain multiemployer pension plans, based on the latest available information received from the plan administrators and trustees. These withdrawal liabilities were triggered as the Company has ceased, or expected to cease, contributing to multiemployer plans for certain locations as part of the Fourth Quarter 2010 Harsco Infrastructure Program. A significant number of union employees in the United States are covered by multiemployer pension plans based on obligations arising from collective bargaining agreements. These plans provide retirement benefits to all plan participants based on their service to contributing employers, including union employees of the Company. These retirement benefits are paid from assets held in trust for that purpose. The Company is only one of several employers participating in each of these plans. A withdrawal liability is recorded when it is probable that a liability exists and the amount can be reasonably estimated from the financial information that is provided by the third-party trustees of the plans pursuant to the Employee Retirement Income Security Act. At times, this financial information may be dated or insufficient to reasonably estimate an accrual at the balance sheet date when the Company has determined it is probable that a liability exists.
|  | Costs to Exit Activities
(In thousands) |  | 2012 |  | 2011 |  | 2010
Harsco Metals & Minerals Segment |  | $ | 3,627 |  |  | $ | 1,313 |  |  | $ | 930 |
Harsco Infrastructure Segment |  | 34,820 |  |  | 8,694 |  |  | 33,458 |
Harsco Industrial Segment |  | — |  |  | — |  |  | (4 | )
Corporate |  | 179 |  |  | — |  |  | — |
Total |  | $ | 38,626 |  |  | $ | 10,007 |  |  | $ | 34,384 |
Product Line Rationalization The product line rationalization charges of $25.0 million, $66.1 million and $34.3 million in 2012, 2011 and 2010, respectively, represent a write-down of certain rental assets and sale inventories in the Harsco Infrastructure Segment that were discontinued as part of the 2011/2012 Restructuring Program and the Fourth Quarter 2010 Harsco Infrastructure Program, to streamline and optimize product offerings. These charges are net of estimated salvage value. Salvage values were based on estimates of proceeds to be realized through the sale of this inventory outside the normal course of business. The 2011/2012 Restructuring Program and the Fourth Quarter 2010 Harsco Infrastructure Program should result in a reduction in the number of product lines offered and is an extension of the Harsco Infrastructure Segment initiative to optimize the operating footprint and reduce the number of operating locations. By streamlining the product offerings, the Company anticipates it should improve customer service to allow for more efficient operations, thereby reducing selling, engineering, logistics, warehousing and maintenance costs; minimizing future capital expenditures due to reduced product line offerings; improving capacity utilization; and eliminating unnecessary redundancy in its product offering. Customers will be serviced using available alternative systems that should ensure no reduction in the rental capacity of the Company. Impaired Asset Write-downs Impaired asset write-downs are measured as the amount by which the carrying amount of assets exceeds their fair value. Fair value is estimated based upon the expected future realizable cash flows including anticipated selling prices. Non-cash impaired asset write-downs are included in other, net on the Consolidated Statements of Cash Flows as adjustments to reconcile net income (loss) to net cash provided by operating activities. There were impaired asset write-downs recorded of $7.2 million in 2012. In 2012, impaired asset write-downs were recorded in the Harsco Metals & Minerals Segment principally in the Asia-Pacific region resulting from exiting an underperforming contract. There were no impaired asset write-downs recorded in 2011. There were impaired asset write-downs recorded of $10.0 million in 2010. In 2010, impaired asset write-downs of were recorded principally in the Harsco Infrastructure Segment in the United Kingdom and in the Harsco Metals & Minerals Segment in the United States. The Harsco Infrastructure Segment write-downs in 2010 related primarily to adjustments to realizable value for two lines of business upon transfer to assets held for sale in other current assets on the Consolidated Balance Sheets in conjunction with the Fourth Quarter 2010 Harsco Infrastructure Program.
|  | Impaired Asset Write-downs
(In thousands) |  | 2012 |  | 2011 |  | 2010
Harsco Metals & Minerals Segment |  | $ | 7,152 |  |  | $ | — |  |  | $ | 1,028 |
Harsco Infrastructure Segment |  | — |  |  | — |  |  | 8,938 |
Total |  | $ | 7,152 |  |  | $ | — |  |  | $ | 9,966 |

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- Definition Discloses other income and expenses which may include but is not limited to, restructuring costs for employee termination benefits and costs to exit activities; impaired asset write-downs; production line rationalizations; net gains or losses on the disposal of non-core assets; and fair value accounting adjustments to recent acquisitions by the Company. + References No definition available. + Details
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