restructuring charge

Restructuring Charge

A cost that a company incurs when it reorganizes its operations. Restructuring charges include costs with opening or closing a factory, hiring new employees or paying the severances for lay-offs, and so forth. Restructuring charges are included in the calculation of a company's net income, but because they are unusual, a high restructuring charge is less likely to result in a steep decline in the company's share price.

restructuring charge

The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. It is not considered an extraordinary item and must be considered when calculating a firm's income from continuing operations.
Case Study In August 2001 Procter & Gamble Co. reported the first quarterly loss in nearly a decade. The $320 million quarterly loss resulted from a $1.16 billion restructuring charge to account for corporate streamlining and altering the firm's portfolio of brands. Procter & Gamble was in the process of divesting most of its food and drink business, mostly by entering into a joint venture with Coca-Cola, a plan that was later abandoned. The company reported it planned to continue taking restructuring charges through mid-2004. At the same time P&G reported the net loss, it announced that operating income increased 12% to 60¢ per share. Restructuring charges are often given little weight by investors and analysts who evaluate a company's financial performance, because these charges are considered one-time expenses. The market price of Procter & Gamble's common stock experienced no significant price change on the day the loss was announced.
References in periodicals archive ?
Scripps began its restructuring work in Q3 2017 with a $2.4 million restructuring charge. The company will take a restructuring charge of $2 million in Q4, and estimates a $4 million charge in Q1 2018; it expects to take smaller quarterly charges into 2019.
Earnings per share from continuing operations in the first quarter of fiscal year 2016 includes a 21 cent restructuring charge.
Factoring in the restructuring charge, management forecasts reported earnings per share of 38 cents to 48 cents per share.
31 July 2013 - Dutch genetic-testing specialist Qiagen (ETR:QIA) said Tuesday it slipped to a second-quarter net loss of USD 51.8 million (EUR 39.1m) in 2013, mainly due to a restructuring charge but confirmed its full-year outlook.
Extreme Networks will record a pre-tax restructuring charge of approximately USD3.5m in its fiscal fourth quarter, which ended 3 July 2011.
Related to the actions, Ahlstrom will book a non-recurring restructuring charge of 7 million [euro] in its fourth quarter of 2008.
Results took into account a C$70 million restructuring charge mostly tied to job cuts; a C$2 million charge for store closings, and C$7 million to cover inventory liquidation.
In addition, among the firms that make restructuring charge announcements and then subsequently disappear in the short term, the majority include costs to eliminate or curtail product lines.
Including a restructuring charge, pre-tax profits were down from pounds 167m to pounds 149m.
Domtar lost $349 million during the quarter due to a $400 million restructuring charge. The company reported 2005 net losses of $388 million compared to $42 million the previous year.
Closure of the Squamish pulp mill will result in a pre-tax restructuring charge in the fourth quarter of an estimated C$ 80 million (US$ 69 million), including a non-cash charge of C$ 46 million (US$ 40 million) relating to the write-down of fixed assets and supplies inventories.
It said this will produce a loss of $40m and $45m, including a restructuring charge of $20m.