6. RESTRUCTURING, IMPAIRMENT AND PLANT CLOSING COSTS
ÌýÌýÌýÌýÌýÌýÌýÌýAs of JuneÌý30, 2011 and DecemberÌý31, 2010, accrued restructuring costs by type of cost and initiative consisted of the following (dollars in millions):
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|
|
|
|
|
|
|
|
|
|
|
|
Ìý
|
Ìý |
Workforce reductions(1) |
Ìý |
Demolition and decommissioning |
Ìý |
Noncancelable lease costs |
Ìý |
Other restructuring costs |
Ìý |
Total(2) |
Ìý |
Accrued liabilities as of JanuaryÌý1, 2011
|
Ìý |
$ |
36 |
Ìý |
$ |
1 |
Ìý |
$ |
1 |
Ìý |
$ |
11 |
Ìý |
$ |
49 |
Ìý |
2011 charges for 2006 and prior initiatives
|
Ìý |
Ìý |
1 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
1 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
2 |
Ìý |
2011 charges for 2009 initiatives
|
Ìý |
Ìý |
1 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
2 |
Ìý |
Ìý |
3 |
Ìý |
2011 charges for 2010 initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
2 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
1 |
Ìý |
Ìý |
3 |
Ìý |
2011 charges for 2011 initiatives
|
Ìý |
Ìý |
11 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
11 |
Ìý |
Reversal of reserves no longer required
|
Ìý |
Ìý |
(3 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(3 |
) |
2011 payments for 2006 and prior initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
2011 payments for 2008 initiatives
|
Ìý |
Ìý |
(1 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
2011 payments for 2009 initiatives
|
Ìý |
Ìý |
(2 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(3 |
) |
Ìý |
(5 |
) |
2011 payments for 2010 initiatives
|
Ìý |
Ìý |
(9 |
) |
Ìý |
(2 |
) |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Ìý |
(12 |
) |
2011 payments for 2011 initiatives
|
Ìý |
Ìý |
(1 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Net activity of discontinued operations
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Ìý |
(1 |
) |
Foreign currency effect on liability balance
|
Ìý |
Ìý |
3 |
Ìý |
Ìý |
(1 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
2 |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Accrued liabilities as of JuneÌý30, 2011
|
Ìý |
$ |
36 |
Ìý |
$ |
— |
Ìý |
$ |
1 |
Ìý |
$ |
9 |
Ìý |
$ |
46 |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
- (1)
- The total workforce reduction reserves of $36Ìýmillion relate to the termination of 255 positions, of which 218 positions had not been terminated as of JuneÌý30, 2011.
- (2)
- Accrued liabilities by initiatives were as follows (dollars in millions):
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|
|
|
|
|
Ìý
|
Ìý |
JuneÌý30,
2011 |
Ìý |
DecemberÌý31,
2010 |
Ìý |
2006 initiatives and prior
|
Ìý |
$ |
5 |
Ìý |
$ |
4 |
Ìý |
2008 initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
1 |
Ìý |
2009 initiatives
|
Ìý |
Ìý |
17 |
Ìý |
Ìý |
20 |
Ìý |
2010 initiatives
|
Ìý |
Ìý |
14 |
Ìý |
Ìý |
24 |
Ìý |
2011 initiatives
|
Ìý |
Ìý |
10 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Total
|
Ìý |
$ |
46 |
Ìý |
$ |
49 |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
ÌýÌýÌýÌýÌýÌýÌýÌýDetails with respect to our reserves for restructuring, impairment and plant closing costs are provided below by segment and initiative (dollars in millions):
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|
|
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|
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|
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|
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|
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|
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|
Ìý
|
Ìý |
Polyurethanes |
Ìý |
Performance
Products |
Ìý |
Advanced
Materials |
Ìý |
Textile
Effects |
Ìý |
Pigments |
Ìý |
Discontinued
Operations |
Ìý |
Corporate
and Other |
Ìý |
Total |
Ìý |
Accrued liabilities as of JanuaryÌý1, 2011
|
Ìý |
$ |
— |
Ìý |
$ |
1 |
Ìý |
$ |
2 |
Ìý |
$ |
25 |
Ìý |
$ |
8 |
Ìý |
$ |
8 |
Ìý |
$ |
5 |
Ìý |
$ |
49 |
Ìý |
2011 charges for 2006 and prior initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
1 |
Ìý |
Ìý |
1 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
2 |
Ìý |
2011 charges for 2009 initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
3 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
3 |
Ìý |
2011 charges for 2010 initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
2 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
1 |
Ìý |
Ìý |
3 |
Ìý |
2011 charges for 2011 initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
3 |
Ìý |
Ìý |
5 |
Ìý |
Ìý |
3 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
11 |
Ìý |
Reversal of reserves no longer required
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(3 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(3 |
) |
2011 payments for 2006 and prior initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
2011 payments for 2008 initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
2011 payments for 2009 initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(5 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(5 |
) |
2011 payments for 2010 initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(8 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(4 |
) |
Ìý |
(12 |
) |
2011 payments for 2011 initiatives
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Net activity of discontinued operations
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Ìý |
— |
Ìý |
Ìý |
(1 |
) |
Foreign currency effect on liability balance
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
3 |
Ìý |
Ìý |
(1 |
) |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
2 |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Accrued liabilities as of JuneÌý30, 2011
|
Ìý |
$ |
— |
Ìý |
$ |
1 |
Ìý |
$ |
5 |
Ìý |
$ |
23 |
Ìý |
$ |
8 |
Ìý |
$ |
7 |
Ìý |
$ |
2 |
Ìý |
$ |
46 |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Current portion of restructuring reserves
|
Ìý |
$ |
— |
Ìý |
$ |
1 |
Ìý |
$ |
4 |
Ìý |
$ |
23 |
Ìý |
$ |
8 |
Ìý |
$ |
7 |
Ìý |
$ |
2 |
Ìý |
$ |
45 |
Ìý |
Long-term portion of restructuring reserve
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
1 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
1 |
Ìý |
Estimated additional future charges for current restructuring projects
|
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Estimated additional charges within one year
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
5 |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
5 |
Ìý |
Estimated additional charges beyond one year
|
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
Ìý |
— |
Ìý |
ÌýÌýÌýÌýÌýÌýÌýÌýDetails with respect to cash and noncash restructuring charges by initiative are provided below (dollars in millions):
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|
|
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|
|
|
|
Ìý
|
Ìý |
Three Months Ended
JuneÌý30, 2011 |
Ìý |
Six Months Ended
JuneÌý30, 2011 |
Ìý |
Cash charges:
|
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
2011 charges for 2006 and prior initiatives
|
Ìý |
$ |
— |
Ìý |
$ |
2 |
Ìý |
Ìý |
2011 charges for 2009 initiatives
|
Ìý |
Ìý |
2 |
Ìý |
Ìý |
3 |
Ìý |
Ìý |
2011 charges for 2010 initiatives
|
Ìý |
Ìý |
2 |
Ìý |
Ìý |
3 |
Ìý |
Ìý |
2011 charges for 2011 initiatives
|
Ìý |
Ìý |
6 |
Ìý |
Ìý |
11 |
Ìý |
Reversal of reserves no longer required
|
Ìý |
Ìý |
(1 |
) |
Ìý |
(3 |
) |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Total 2011 Restructuring, Impairment and Plant Closing Costs
|
Ìý |
$ |
9 |
Ìý |
$ |
16 |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý
|
|
|
|
|
|
|
|
|
Ìý
|
Ìý |
Three Months Ended
JuneÌý30, 2010 |
Ìý |
Six Months Ended
JuneÌý30, 2010 |
Ìý |
Cash charges:
|
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
2010 charges for 2005 initiatives
|
Ìý |
$ |
1 |
Ìý |
$ |
1 |
Ìý |
Ìý |
2010 charges for 2009 initiatives
|
Ìý |
Ìý |
3 |
Ìý |
Ìý |
5 |
Ìý |
Ìý |
2010 charges for 2010 initiatives
|
Ìý |
Ìý |
16 |
Ìý |
Ìý |
20 |
Ìý |
Reversal of reserves no longer required
|
Ìý |
Ìý |
(3 |
) |
Ìý |
(6 |
) |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Total 2010 Restructuring, Impairment and Plant Closing Costs
|
Ìý |
$ |
17 |
Ìý |
$ |
20 |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
Ìý |
ÌýÌýÌýÌýÌýÌýÌýÌýDuring the six months ended JuneÌý30, 2011, our Advanced Materials segment recorded charges of $3Ìýmillion primarily related to the reorganization of our global structure and relocation of our divisional headquarters from Basel, Switzerland to The Woodlands, Texas.
ÌýÌýÌýÌýÌýÌýÌýÌýDuring the six months ended JuneÌý30, 2011, our Textile Effects segment recorded charges of $8Ìýmillion of which $5Ìýmillion related to simplification of the commercial organization and optimization of our distribution network, $2Ìýmillion related to nonworkforce reductions incurred for the consolidation of our Switzerland manufacturing facilities, and $1Ìýmillion related to the consolidation of our North Carolina sites. We reversed charges of $3Ìýmillion which were no longer required for workforce reductions at our production facility in Langweid, Germany and the consolidation of manufacturing activities and processes at our site in Basel, Switzerland.
ÌýÌýÌýÌýÌýÌýÌýÌýDuring the six months ended JuneÌý30, 2011, our Pigments segment recorded charges of $7Ìýmillion of which $3Ìýmillion related to the closure of our Grimsby, U.K. plant and $3Ìýmillion related to workforce reductions at our Umbogintwini, South Africa plant. We expect to incur additional charges of $5Ìýmillion through DecemberÌý31, 2012, primarily related to the closure of our Grimsby, U.K. plant.
ÌýÌýÌýÌýÌýÌýÌýÌýDuring the six months ended JuneÌý30, 2011, we recorded charges of $1Ìýmillion in Corporate and other primarily related to workforce reductions in connection with a reorganization and regional consolidation of our transactional accounting activities.
|