| Restructuring, Impairment, and Other Activities Disclosure [Text Block] |
| (10) |
Restructuring and Other Impairment Activities |
Restructuring and other impairment charges, net of gains, were as follows (in thousands):
| |
|
Fiscal Year Ended June 30, |
|
| |
|
2022 |
|
|
2021 |
|
| Gain on sales of property, plant and equipment(1) |
|
$ |
(5,431 |
) |
|
$ |
(473 |
) |
| Severance and other charges |
|
|
970 |
|
|
|
422 |
|
| Lease exit costs(2) |
|
|
- |
|
|
|
1,537 |
|
| Impairment of long-lived assets(3) |
|
|
- |
|
|
|
623 |
|
| Optimization of manufacturing and logistics(4) |
|
|
- |
|
|
|
302 |
|
| Total Restructuring and other impairment charges, net of gains |
|
$ |
(4,461 |
) |
|
$ |
2,411 |
|
| |
|
|
|
|
|
|
|
|
| Optimization of manufacturing and logistics(4) |
|
|
- |
|
|
|
54 |
|
| Inventory write-downs and additional reserves(5) |
|
|
- |
|
|
|
585 |
|
| Total |
|
$ |
(4,461 |
) |
|
$ |
3,050 |
|
| |
(1) |
In March 2022, we sold a previously closed property to an independent third party for $2.6 million, which resulted in a pre-tax gain of $1.5 million. During the second quarter of fiscal 2022 we also completed the sale of our Atoka, Oklahoma distribution center for $2.8 million, less closing costs, and recognized a pre-tax gain of $2.0 million. In addition, in December 2021, we completed the sale of a property for $5.6 million, which resulted in a pre-tax gain of $1.9 million. During the prior year period, we completed the sale of two previously closed properties to independent third parties. As a result of these sales, the Company recognized a pre-tax gain of $0.5 million. |
| |
(2) |
We recorded restructuring charges of $1.5 million during the prior year period related to lease exit costs within the retail segment as a result of an early termination of a lease, the closing and subsequent exiting of a retail design center and the payment to assign a lease to an independent third-party. |
| |
(3) |
We recorded a non-cash charge of $0.6 million during the prior year period related to the impairment of long-lived assets held at a retail design center location. The asset group used for impairment analysis was the individual retail design center, which represented the lowest level for which identifiable cash flows were available and largely independent of the cash flows of other groups of assets. We estimated future cash flows based on design center-level historical results, current trends and operating and operating and cash flow projections. |
| |
(4) |
Over the past several years, we have executed on many key initiatives to further optimize our manufacturing and logistics, including closing our Passaic, New Jersey property, converting our Old Fort, North Carolina case goods manufacturing operations into a distribution center, expanding our existing Maiden, North Carolina manufacturing campus and closing our Atoka, Oklahoma distribution center and consolidating its workflow into our Old Fort, North Carolina facility. We recorded charges of $0.4 million in the year ago period related to the closing of our Atoka distribution center with $0.3 million within the line item Restructuring and other impairment charges, net of gains in the consolidated statements of comprehensive income and $0.1 million within Cost of Sales. |
| |
(5) |
We recorded a non-cash charge of $0.6 million in the prior year 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, $0.4 million related to slow moving finished goods with the remaining $0.2 million consisting of raw materials that were disposed of. These non-cash inventory write-downs were recorded in the consolidated statement of comprehensive income within the line item Cost of Sales. |
The Company’s restructuring and other impairment activity is summarized in the table below (in thousands):
| |
|
|
|
|
Fiscal 2022 Activity |
|
|
|
|
| |
|
Balance June 30, 2021 |
|
|
New Charges (Income) |
|
|
Non-Cash |
|
|
(Payments) Receipts |
|
|
Balance June 30, 2022 |
|
| Lease exit costs |
|
$ |
645 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
(460 |
) |
|
$ |
185 |
(1)
|
| Sale of property, plant and equipment |
|
|
- |
|
|
|
(5,431 |
) |
|
|
5,182 |
|
|
|
10,613 |
|
|
|
- |
|
| Severance and other charges |
|
|
439 |
|
|
|
970 |
|
|
|
45 |
|
|
|
(1,096 |
) |
|
|
268 |
(2)
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Restructuring and other impairment activities |
|
$ |
1,084 |
|
|
$ |
(4,461 |
) |
|
$ |
5,227 |
|
|
$ |
9,057 |
|
|
$ |
453 |
|
| |
(1) |
The remaining balance as of June 30, 2022 of $0.2 million represents remaining monthly lease payments due under a retail design center that was exited during fiscal 2021. The remaining amount of rent to be paid is accrued within Accounts payable and accrued expenses. |
| |
(2) |
The remaining balance from other charges as of June 30, 2022 is recorded as a contra-asset balance of $0.2 million within Prepaid expenses and other current assets and $0.1 million within Accrued compensation and benefits. |
|