3M 2011 Annual Report Download - page 69

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As discussed in Note 13, in June 2009, 3M tested the long lived assets grouping associated with the U.K. passport
production activity of 3M’s Security Systems Division for recoverability. This circumstance required the Company to
also test goodwill for impairment at the reporting unit (Security Systems Division) level. 3M completed its assessment
of potential goodwill impairment for this reporting unit and determined that no goodwill impairment existed as of
June 30, 2009.
Acquired Intangible Assets
For 2011, intangible assets (excluding goodwill) acquired through business combinations increased the gross
carrying amount by $342 million. Balances are also impacted by changes in foreign currency exchange rates. The
gross carrying amount and accumulated amortization of acquired intangible assets as of December 31 follow:
(Millions) 2011 2010
Patents ................................................................................................................. $ 561 $ 551
Other amortizable intangible assets (primarily tradenames and customer-related
intangibles) ....................................................................................................... 2,323 2,016
Non-amortizable intangible assets (tradenames) ................................................ 123 125
Total gross carrying amount ................................................................................. $ 3,007 $ 2,692
A
ccumulated amortization — patents .................................................................. (374) (345 )
A
ccumulated amortization — other ...................................................................... (717) (527 )
Total accumulated amortization ........................................................................ (1,091) (872 )
Total intangible assets — net ............................................................................... $ 1,916 $ 1,820
3M has certain tradenames that are not amortized because of the long-time established name recognition in their
respective industries.
Amortization expense for the years ended December 31 follows:
(Millions) 2011 2010 2009
A
mortization expense .............................................................. $ 235 $ 176 $ 181
Expected amortization expense for acquired amortizable intangible assets recorded as of December 31, 2011
follows:
(Millions) 2012 2013 2014 2015 2016 After 2016
A
mortization expense .......... $ 225 $ 214 $ 191 $ 178 $ 165 $ 820
The preceding expected amortization expense is an estimate. Actual amounts of amortization expense may differ
from estimated amounts due to additional intangible asset acquisitions, changes in foreign currency exchange rates,
impairment of intangible assets, accelerated amortization of intangible assets and other events. 3M expenses the
costs incurred to renew or extend the term of intangible assets.
NOTE 4. Restructuring Actions
Restructuring actions generally include significant actions involving employee-related severance charges, contract
termination costs, and impairment of assets associated with such actions. Accounting policies related to these
activities are discussed in Note 1.
The following provides information concerning the Company’s 2009 restructuring actions.
2009 Restructuring Actions:
During the first nine months of 2009, management approved and committed to undertake certain restructuring
actions. Due to the rapid decline in global business activity in the fourth quarter of 2008 and into the first three
quarters of 2009, 3M aggressively reduced its cost structure and rationalized several facilities, including
manufacturing, technical and office facilities. These actions included all geographies, with particular attention in the
developed areas of the world that have and are experiencing large declines in business activity, and included the
following actions during 2009:
x During the first quarter of 2009, 3M announced the elimination of approximately 1,200 positions. Of these
employment reductions, about 43 percent were in the United States, 36 percent in Latin America, 16 percent