General Mills (GIS)

(5)   Restructuring and Other Exit Costs

In the second quarter of fiscal 2007, we recorded income related to restructuring and other exit costs of $1 million associated with adjustments to restructuring actions previously announced.

In the second quarter of fiscal 2006 we recorded restructuring and other exit costs of $2 million primarily associated with an asset impairment recognized at our Swedesboro, New Jersey production plant.

In the first twenty-six weeks of fiscal 2007, we recorded income related to restructuring and other exit activities of $3 million. We sold our previously closed plant in San Adrian, Spain, resulting in a gain of $9 million. We incurred a $6 million loss associated with the divestiture of our par-baked bread product line, including its plants in Chelsea, Massachusetts and Tempe, Arizona. Net proceeds received for the par-baked product line were $12 million.

In the first twenty-six weeks of fiscal 2006, we recorded restructuring and other exit costs of $11 million, consisting of $10 million of charges related to an asset impairment recognized at our Swedesboro, New Jersey production plant and $1 million of charges associated with restructuring activities previously announced.

(3)   Restructuring and Other Exit Costs

In the third quarter of fiscal 2006, we recorded restructuring and other exit costs of $5 million, consisting of $2 million primarily for severance costs associated with the closure of our frozen dough foodservice plant in Swedesboro, New Jersey; $2 million of restructuring costs at our Allentown, Pennsylvania frozen waffle plant, primarily related to product and production realignment; and $1 million associated with restructuring actions previously announced. The decision to close the Swedesboro plant affected approximately 101 employees and was undertaken to increase asset utilization and reduce manufacturing costs. The restructuring action at the Allentown plant affected approximately 60 employees and was undertaken to reduce manufacturing costs and eliminate a low-margin product line.

In the third quarter of fiscal 2005, we recorded $3 million of restructuring and other exit costs associated with restructuring actions previously announced.

In the first thirty-nine weeks of fiscal 2006, we recorded restructuring and other exit costs of $16 million, consisting of $12 million of charges associated with the closure of the plant in Swedesboro, New Jersey, including $10 million of asset impairment charges recorded in the first and second quarters of fiscal 2006; $2 million related to the restructuring at the plant in Allentown, Pennsylvania; and $2 million of charges associated with restructuring actions previously announced.

In the first thirty-nine weeks of fiscal 2005, we recorded restructuring and other exit costs of $46 million, consisting of $40 million of charges associated with supply chain initiatives to further increase asset utilization and reduce manufacturing and sourcing costs, and $6 million of charges associated with restructuring actions previously announced.

The fiscal 2005 supply chain actions also resulted in certain associated expenses, primarily adjustments to the depreciable life of the assets necessary to reflect the shortened asset lives which coincided with final production dates. These associated expenses were recorded as cost of sales. In the third quarter of fiscal 2006, there were no associated expenses; in the third quarter of fiscal 2005, the associated expense recorded was $3 million. For the first thirty-nine weeks of fiscal 2006, the expense was $2 million; for the first thirty-nine weeks of fiscal 2005, the expense was $16 million.

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(2)   Restructuring and Other Exit Costs

In the second quarter of fiscal 2006, we recorded restructuring and other exit costs of $2 million, primarily associated with an additional asset impairment recognized at one of our production plants.

In the second quarter of fiscal 2005, we recorded $3 million of restructuring and other exit costs associated with restructuring actions previously announced.

In the first twenty-six weeks of fiscal 2006, we recorded restructuring and other exit costs of $11 million, consisting of $10 million of charges related to an asset impairment recognized at one of our production plants and $1 million of charges associated with restructuring actions previously announced.

In the first twenty-six weeks of fiscal 2005, we recorded restructuring and other exit costs of $43 million, consisting of $38 million of charges associated with supply chain initiatives to further increase asset utilization and reduce manufacturing and sourcing costs, and $5 million of charges associated with restructuring actions previously announced.

The fiscal 2005 supply chain actions also resulted in certain associated expenses, primarily adjustments to the depreciable life of the assets necessary to reflect the shortened asset lives which coincided with final production dates. These associated expenses were recorded as cost of sales. In the second quarter of fiscal 2006, there were no associated expenses; in the second quarter of fiscal 2005, the associated expense recorded in cost of sales was $8 million. For the first twenty-six weeks of fiscal 2006, the expense recorded in cost of sales was $2 million; for the first twenty-six weeks of fiscal 2005, the expense recorded in cost of sales was $13 million.

(2)   Restructuring and Other Exit Costs

In the first quarter of fiscal 2006, we recorded restructuring and other exit costs of $9 million, consisting of $8 million of charges related to an asset impairment recognized at one of our production plants and $1 million of charges associated with restructuring actions previously announced.

In the first quarter of fiscal 2005, we recorded restructuring and other exit costs of $40 million, consisting of $38 million of charges associated with first-quarter supply chain initiatives and $2 million of charges associated with restructuring actions previously announced. The first-quarter initiatives were undertaken to further increase asset utilization and reduce manufacturing and sourcing costs, resulting in decisions regarding plant closures and production realignment.

Fiscal 2005 supply chain actions also resulted in certain associated expenses, primarily adjustments to the depreciable life of the assets necessary to reflect the shortened asset lives that coincide with final production dates. These associated expenses were recorded as cost of sales. In the first quarter of fiscal 2006, the expense recorded in cost of sales was $2 million; in the first quarter of fiscal 2005, the expense recorded in cost of sales was $5 million.

(2)   Restructuring and Other Exit Costs

In the third quarter of fiscal 2005, we recorded $3 million of restructuring and other exit costs associated with previously announced restructuring actions.

In the third quarter of fiscal 2004, we recorded restructuring and other exit costs of $5 million, primarily related to adjustments of costs associated with previously announced closures of former Pillsbury facilities as well as costs incurred related to plant closures initiated in the second quarter (the Netherlands and Atwater, California).

In the first thirty-nine weeks of fiscal 2005, we recorded restructuring and other exit costs of $46 million, consisting of $40 million of charges associated with fiscal 2005 supply chain initiatives and $6 million of charges associated with previously announced restructuring actions. The fiscal 2005 initiatives were undertaken to further increase asset utilization and reduce manufacturing and sourcing costs, resulting in decisions regarding plant closures and production realignment. The charges included severance and curtailment costs of approximately $13 million for 323 employees being terminated and asset write-off costs of approximately $21 million. The supply chain actions included decisions to: close our flour milling plant in Vallejo, California, affecting 43 employees; close our par-baked bread plant in Medley, Florida, affecting 42 employees; relocate bread production from our Swedesboro, New Jersey plant, affecting 110 employees; relocate a portion of our cereal production from Cincinnati, Ohio, affecting 45 employees; and close our snacks foods plant in Iowa City, Iowa, affecting 83 employees.

Additional restructuring charges related to previous fiscal 2005 supply chain initiatives of approximately $4 million are expected to be recognized during the next two quarters.

These fiscal 2005 supply chain actions are also resulting in certain associated expenses, primarily adjustments to the depreciable life of the assets necessary to reflect the shortened asset lives which now coincide with the final production dates at the Cincinnati and Iowa City plants. These associated expenses are being recorded as cost of sales. The fiscal 2005 expense recorded in cost of sales was $3 million during the third quarter and $16 million during the first thirty-nine weeks of the fiscal year. We expect to record an additional $7 million of expense in cost of sales, primarily accelerated depreciation expense, during the next two quarters associated with the anticipated production schedules of these two plants.

In the first thirty-nine weeks of fiscal 2004, we recorded $14 million of restructuring and other exit costs. This amount included $5 million in the third quarter as described above, as well as charges associated with plant closures initiated in the second quarter (the Netherlands and Atwater, California).

(2)   Restructuring and Other Exit Costs

In the second quarter of fiscal 2005, we recorded $3 million of restructuring and other exit costs associated with previously announced restructuring actions.

In the second quarter of fiscal 2004, we recorded restructuring and other exit costs of $9 million, primarily related to plant closures in the Netherlands and Atwater, California. Approximately $6 million was related to a severance charge for 142 employees being terminated as a result of the plant closure in the Netherlands. Approximately $3 million was for the closure of our tomato canning facility in Atwater, California. This charge included severance costs of less than $1 million for 47 employees.

In the first twenty-six weeks of fiscal 2005, we recorded restructuring and other exit costs of $43 million, consisting of $38 million of charges associated with first-half supply chain initiatives and $5 million of charges associated with previously announced restructuring actions. The first-half initiatives were undertaken to further increase asset utilization and reduce manufacturing and sourcing costs, resulting in decisions regarding plant closures and production realignment. The charges included severance and curtailment costs of approximately $13 million for 323 employees being terminated and asset write-off costs of approximately $21 million. The supply chain actions included decisions to: close our flour milling plant in Vallejo, California, affecting 43 employees; close our par-baked bread plant in Medley, Florida, affecting 42 employees; relocate bread production from our Swedesboro, New Jersey plant, affecting 110 employees; relocate a portion of our cereal production from Cincinnati, Ohio, affecting 45 employees; and close our snacks foods plant in Iowa City, Iowa, affecting 83 employees.

Additional restructuring charges related to the fiscal 2005 supply chain initiatives of approximately $5 million are expected to be recognized over the remainder of fiscal 2005.

These fiscal 2005 supply chain actions are also resulting in certain associated expenses, primarily adjustments to the depreciable life of the assets necessary to reflect the shortened asset lives which now coincide with the final production dates at the Cincinnati and Iowa City plants. These associated expenses are being recorded as cost of sales. The fiscal 2005 expense recorded in cost of sales was $8 million and $13 million in the second quarter and first half, respectively. We expect to record an additional $11 million of expense in cost of sales, primarily accelerated depreciation expense, during the next three quarters associated with the anticipated production schedules of these two plants.

In the first half of fiscal 2004, we recorded $9 million of restructuring and other exit costs primarily related to plant closures in the Netherlands and Atwater, California, as described above.