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Thermo Fisher Records $83M in Severance-related Costs in Q1

NEW YORK (GenomeWeb) – During the first quarter, Thermo Fisher Scientific recorded about $82.7 million in costs related to a reduction in its headcount and for severance obligations to former Life Technologies executives and employees, the company said in its Form 10-Q filed recently with the US Securities and Exchange Commission.

Thermo Fisher said that in Q1 2014 its Life Sciences Solutions segment recorded $168.8 million in cash restructuring costs, including $91.7 million for cash compensation to monetize certain equity awards held by Life Tech's employees when the company was acquired by Thermo Fisher in February.

The balance, $77.1 million, was "principally for severance obligations payable" to Life Tech's former executives and employees.

Meantime, Thermo Fisher's Specialty Diagnostics segment recorded $3.8 million in cash costs for severance and other costs associated with facility consolidations, while the Laboratory Products and Services segment posted $1.1 million of cash costs for severance and abandoned facility costs.

Lastly, the company said that it recorded $700,000 in cash costs for severance at its corporate operations.

Additionally, Thermo Fisher noted in its Form 10-Q that as of May 2, it identified restructuring charges that will result in about $65 million in additional charges, primarily in the remainder of 2014. It did not break down how much of that may be related to severance costs.

The $82.7 million in severance-related costs for Q1 2014 follows $55.6 million that Thermo Fisher took in 2013 in restructuring charges related to the termination of employees last year.

The company also said that in 2014, its Life Sciences Solutions segment — consisting of the majority of the former Life Tech businesses and Thermo Fisher's biosciences business — acquired an unnamed animal health diagnostics company for $32 million.