Restructuring, impairment and other related costs incurred during fiscal and were as follows (in thousands):

 

		Fiscal 2020				Fiscal 2019
Optimization of manufacturing and logistics		$	829			$	6,330
Gain on sale of Passaic property			(11,497	)			-
Impairment of long-lived assets (retail)			5,171				9,913
Lease exit costs (remaining lease obligations)			2,372				2,662
Other charges (income)			106				(241	)
Total Restructuring and other impairment charges, net of gains		$	(3,019	)		$	18,664
Manufacturing overhead costs (1)			1,319				866
Inventory write-downs (1)			4,107				1,128
Total		$	2,407			$	20,658

 

 

 

The Company's restructuring activity is summarized in the table below (in thousands):

 

						Fiscal 2020 Activity
Optimization of Manufacturing and Logistics		Balance June 30, 2019				New Charges (Income)				Non-Cash				(Payments) Receipts				Balance June 30, 2020
Employee severance, other payroll and benefit costs		$	1,714			$	777			$	23			$	(2,468	)		$	-
Manufacturing overhead costs			-				1,319				-				(1,319	)			-
Sale of Passic property			-				(11,497	)			245				11,742				-
Sale of other property, plant and equipment			-				(675	)			-				675				-
Other exit costs			-				727				(522	)			(1,249	)			-
Sub-total			1,714				(9,349	)			(254	)			7,381				-
Retail Design Center Impairment
Impairment of long-lived assets			-				5,171				5,171				-				-
Other Restructuring and Impairment Charges
Inventory write-downs			-				4,107				4,107				-				-
Lease exit costs (remaining lease rentals)			3,145				2,372				1,847				(3,760	)			(90	) (1)
Other charges (income)			224				106				-				(271	)			59	(2)
Sub-total			3,369				6,585				5,954				(4,031	)			(31	)
Total Restructuring and other impairment activities		$	5,083			$	2,407			$	10,871			$	3,350			$	(31	)

 

 

 

 

During the quarter of fiscal we initiated restructuring plans to consolidate our manufacturing and logistics operations as part of an overall strategy to maximize production efficiencies and maintain our competitive advantage. As of we permanently ceased operations at our Passaic, New Jersey property and ceased using most of our Old Fort, North Carolina case goods manufacturing operations, which we transferred to our other existing case goods operations.

 

We completed this optimization project in fiscal as we converted the Old Fort facility into a distribution center and expanded our existing Maiden, North Carolina manufacturing campus while finalizing severance and other exit costs. In connection with these initiatives, we recorded pre-tax restructuring and other exit charges totaling million, consisting of million in abnormal manufacturing variances associated with the Passaic and Old Fort facilities, million in employee severance and other payroll and benefit costs and million in other exit costs partially offset by million in gains from the sale of property, plant and equipment held at our Old Fort facility. The abnormal manufacturing overhead variances of million were recorded within  with the remaining recorded within the line item  in the consolidated statements of comprehensive income.

 

As part of our optimization plans, we also completed the sale of our Passaic property in to an independent party and received million in cash less certain adjustments, including million in selling and other closing costs. As a result of the sale, the Company recognized a pre-tax gain of million in the quarter of fiscal which was recorded within the line item  in the consolidated statements of comprehensive income.

 

As these optimization plans were initiated in the prior year, we recorded fiscal pre-tax restructuring, impairment, and other related charges totaling million, consisting of million in impairments of long-lived assets, million in employee severance and other payroll and benefit costs, million in inventory write-downs and manufacturing variances and million of other associated costs, including freight and relocation expenses. The inventory write-downs and abnormal manufacturing overhead variances of million were recorded within with the remaining million recorded within the line item in the consolidated statement of comprehensive income.

 

 

We recorded a non-cash impairment charge of million during fiscal related to the impairment of long-lived assets held at certain retail design center locations. Of this total, we recorded million during the quarter of fiscal due to retail segment operating losses driven by the negative economic impacts from COVID- and softened customer demand. The asset group used in the impairment analysis, which represented the lowest level for which identifiable cash flows were available and largely independent of the cash flows of other groups of assets, was the individual retail design center. We estimated future cash flows based on design center-level historical results, current trends, and operating and cash flow projections. The fiscal impairment charge of million was recorded in the consolidated statement of comprehensive income within the line item

 

In the year ago quarter, we recorded a non-cash impairment charge of million related to the impairment of long-lived assets held at certain retail design center locations. Due to the fiscal organizational realignment, we identified this as a triggering event requiring assessment of recoverability. The asset group used in the impairment analysis was the individual retail design center. The impairment charge of million was recorded in the consolidated statement of comprehensive income within the line item 

 

 

During fiscal we recorded a non-cash charge of  million related to the write-down and disposal of certain slow moving and discontinued inventory items, which was due to actual demand and forecasted market conditions for these inventory items being less favorable than originally estimated. Of the total inventory write-down,  million related to slow moving finished goods with the remaining million consisting of raw materials that were disposed. The non-cash inventory write-down was recorded in the consolidated statement of comprehensive income within the line item 

 

 

During fiscal we recorded million of restructuring charges within our retail segment related to the remaining contractual obligations under leased retail space that we exited during our fiscal quarter. During we entered into an amendment to an existing rental lease, whereby we would return the space back to the landlord effective in lieu of termination payments totaling million. Partially offsetting these cash payments was a non-cash credit of million due to the write-off of the related lease liability, net of the ROU asset. The net pre-tax charge of million was recorded in the consolidated statement of comprehensive income within the line item

 

During fiscal we recorded million of charges primarily related to remaining contractual obligations under leased retail design center space for which we ceased using as of The amount of the charge was equal to all costs that will continue to be incurred under our lease for its remaining term without economic benefit and measured at fair value when we ceased using the right conveyed by the contract. The pre-tax charge was recorded in the consolidated statement of comprehensive income within the line item