GIS » Topics » Item 2.05 Costs Associated with Exit or Disposal Activities.

This excerpt taken from the GIS 8-K filed Nov 24, 2009.

Item 2.05 Costs Associated with Exit or Disposal Activities.

On November 19, 2009, General Mills, Inc. ("we," "us" or "our") decided to exit certain underperforming products in its U.S. Retail segment to rationalize capacity for more profitable items. The products we are exiting generated approximately $35 million in net sales in fiscal 2009. As a result of our decisions, we recorded a $24.1 million non-cash restructuring, impairment and other exit charge against the related long-lived assets in the second quarter of fiscal 2010 ending November 29, 2009. There were no employees affected by these actions. We expect to recognize an additional $2.5 million of other exit costs related to these actions in future periods. We anticipate that these actions will be completed by the end of the second quarter of fiscal 2011.

The fiscal 2010 second quarter charge is consistent with our 2010 full-year earnings guidance, which includes an estimated $30 million in restructuring, impairment and other exit costs. We expect that our second quarter 2010 earnings per share will be no less than the current ThomsonReuters mean consensus estimate of $1.43, including this charge and before any impact from mark-to-market valuation of certain commodity positions.

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on our current expectations and assumptions. The words "expect," "anticipate" or similar expressions identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results and those currently anticipated or projected. We caution you not to place undue reliance on any such forward-looking statements.

In connection with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we are identifying important factors that could affect our financial performance and could cause our actual results in future periods to differ materially from any current opinions or statements. Our future results could be affected by a variety of factors, such as: competitive dynamics in the consumer foods industry and the markets for our products, including new product introductions, advertising activities, pricing actions, and promotional activities of our competitors; economic conditions, including changes in inflation rates, interest rates, tax rates, or the availability of capital; product development and innovation; consumer acceptance of new products and product improvements; consumer reaction to pricing actions and changes in promotion levels; acquisitions or dispositions of businesses or assets; changes in capital structure; changes in laws and regulations, including labeling and advertising regulations; impairments in the carrying value of goodwill, other intangible assets, or other long-lived assets, or changes in the useful lives of other intangible assets; changes in accounting standards and the impact of significant accounting estimates; product quality and safety issues, including recalls and product liability; changes in consumer demand for our products; effectiveness of advertising, marketing, and promotional programs; changes in consumer behavior, trends, and preferences, including weight loss trends; consumer perception of health-related issues, including obesity; consolidation in the retail environment; changes in purchasing and inventory levels of significant customers; fluctuations in the cost and availability of supply chain resources, including raw materials, packaging, and energy; disruptions or inefficiencies in the supply chain; volatility in the market value of derivatives used to manage price risk for certain commodities; benefit plan expenses due to changes in plan asset values and discount rates used to determine plan liabilities; failure of our information technology systems; resolution of uncertain income tax matters; foreign economic conditions, including currency rate fluctuations; and political unrest in foreign markets and economic uncertainty due to terrorism or war.

You should also consider the risk factors that we identify on pages 7 through 12 of our Annual Report on Form 10-K for the fiscal year ended May 31, 2009, which could also affect our future results.

We undertake no obligation to publicly revise any forward-looking statements to reflect events or circumstances after the date of those statements or to reflect the occurrence of anticipated or unanticipated events.

This excerpt taken from the GIS 8-K filed Apr 17, 2009.

Item 2.05 Costs Associated with Exit or Disposal Activities.

On April 16, 2009, General Mills, Inc. (the "Company") approved the restructuring of its business in Brazil, and has discontinued the production and marketing of the Forno De Minas and Frescarini brands in Brazil. The Company will close its Contagem, Brazil manufacturing facility. The Company’s other product lines in Brazil are not affected by the decision. As a result of this decision, the Company anticipates incurring a pretax charge of approximately $20 million in the fourth quarter of fiscal 2009, consisting primarily of $13 million to write down assets to their net realizable value and $6 million for accrued severance. The Company also anticipates incurring pretax costs of approximately $5 million in fiscal 2010 from this action, primarily cash expenditures for decommissioning the plant.


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

    General Mills, Inc.
April 17, 2009   By:   Donal L. Mulligan
        Name: Donal L. Mulligan
        Title: Executive Vice President and Chief Financial Officer
This excerpt taken from the GIS 8-K filed Mar 11, 2009.

Item 2.05 Costs Associated with Exit or Disposal Activities.

On March 9, 2009, General Mills, Inc. (the "Company") entered into an agreement to sell a portion of the assets of the frozen unbaked bread dough product line for its Bakeries and Foodservice segment. The Company expects the transaction to close during the fourth quarter of fiscal 2009, and expects to record a loss of approximately $19 million after taxes in the fourth quarter of fiscal 2009 in connection with the sale, primarily the result of the write-off of associated goodwill.

Certain assets being sold are shared with a frozen dinner roll product line for the Company's U.S. Retail segment. As a result of the sale, the Company will exit this product line. The Company expects to record an after-tax charge of approximately $13 million in the fourth quarter of fiscal 2009 related to the termination of this product line, consisting of a $20 million pre-tax non-cash impairment charge against long-lived assets and approximately $1 million pre-tax of other costs associated with the exit of the product line, primarily employee severance.

The Company will present this transaction as a Divestiture in its Consolidated Statements of Earnings.

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