TIME WARNER INC. | 2013 | FY | 3


14.       RESTRUCTURING AND SEVERANCE COSTS

 

The Company's Restructuring and severance costs primarily related to employee termination costs, ranging from senior executives to line personnel, and other exit costs, including lease terminations. Restructuring and severance costs expensed as incurred for the years ended December 31, 2013, 2012 and 2011 are as follows (millions):

 

   Year Ended December 31,
   2013 2012 2011
         
 Turner $ 93 $ 52 $ 37
 Home Box Office   39   15   15
 Warner Bros.   49   23   41
 Time Inc.   63   27   18
 Corporate   2   2   2
 Total restructuring and severance costs $ 246 $ 119 $ 113

   Year Ended December 31,
   2013 2012 2011
         
 2013 activity $ 242 $ - $ -
 2012 activity   8   101   -
 2011 and prior activity   (4)   18   113
 Restructuring and severance costs $ 246 $ 119 $ 113

2013 Initiatives

 

For the year ended December 31, 2013, the Company incurred $242 million in Restructuring and severance costs primarily related to various employee terminations and other exit activities, including $87 million at the Turner segment, $39 million at the Home Box Office segment, $42 million at the Warner Bros. segment, $69 million at the Time Inc. segment and $5 million at Corporate.

 

2012 Initiatives

 

For the year ended December 31, 2012, the Company incurred $101 million in Restructuring and severance costs primarily related to various employee terminations and other exit activities, including $52 million at the Turner segment, $15 million at the Home Box Office segment, $10 million at the Warner Bros. segment, $22 million at the Time Inc. segment and $2 million at Corporate.

 

During the year ended December 31, 2013, the Company incurred Restructuring and severance costs $6 million at the Turner segment and $2 million at the Warner Bros. segment relating to the 2012 restructuring initiatives.

 

2011 and Prior Year Initiatives

 

For the year ended December 31, 2011, the Company incurred $113 million in Restructuring and severance costs primarily related to various employee terminations and other exit activities, including $37 million at the Turner segment, $15 million at the Home Box Office segment, $41 million at the Warner Bros. segment, $18 million at the Time Inc. segment and $2 million at Corporate.

 

During the years ended December 31, 2013 and December 31, 2012, the Company also adjusted certain charges related to the restructuring initiatives that were undertaken in 2011 and prior years as a result of changes in estimates of previously established accruals. During the year ended December 31, 2013, the Company incurred $5 million at the Warner Bros. segment, reversed $6 million at the Time Inc. segment and reversed $3 million at Corporate related to the 2011 and prior year initiatives. During the year ended December 31, 2012, the Company incurred $13 million at the Warner Bros. segment and $5 million at the Time Inc. segment related to the 2011 and prior year initiatives.

 

Selected Information

 

Selected information relating to accrued restructuring and severance costs is as follows (millions):

 

   Employee Terminations Other Exit Costs  Total
 Remaining liability as of December 31, 2010 $ 107 $ 84 $ 191
 Net accruals   102   11   113
 Noncash reductions(a)   (5)   -   (5)
 Cash paid   (88)   (35)   (123)
 Remaining liability as of December 31, 2011   116   60   176
 Net accruals   104   15   119
 Noncash reductions(a)   (1)   -   (1)
 Cash paid   (101)   (27)   (128)
 Remaining liability as of December 31, 2012   118   48   166
 Net accruals   241   5   246
 Noncash reductions(a)   (3)   -   (3)
 Cash paid   (148)   (17)   (165)
 Remaining liability as of December 31, 2013 $ 208 $ 36 $ 244
 ____________         

(a)        Noncash reductions relate to the settlement of certain employee-related liabilities with equity instruments.

As of December 31, 2013, of the remaining liability of $244 million, $144 million was classified as a current liability in the Consolidated Balance Sheet, with the remaining $100 million classified as a long-term liability. Amounts classified as long-term are expected to be paid through 2020.


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