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, for the most part, transferred our Old Fort, North Carolina case goods manufacturing operations to our other existing operations. As a result, approximately of our associates in Old Fort and associates in Passaic were terminated.

 

During the quarter of fiscal we continued with this optimization project 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 associated with our case goods operations. In connection with the foregoing quarter fiscal initiatives, we recorded pre-tax restructuring and other exit charges totaling million, consisting of million in manufacturing variances associated with the closing of the Passaic property and the repurposing of the Old Fort case goods manufacturing operations, million in employee severance and other payroll and benefit costs, and million of other exit costs. The manufacturing overhead variances of million were recorded within with the remaining million recorded within the line item in the consolidated statements of comprehensive income.

 

As part of our optimization plans, we completed the sale of our Passaic property in to an independent party and received million in cash less certain adjustments set forth in the purchase and sale agreement, 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.

 

 

During the quarter of 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 

 

 

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

 

		Three months ended
		September 30, 2019
Optimization of manufacturing and logistics		$	640
Gain on sale of Passaic property			(11,497	)
Total Restructuring and other exit costs (income)		$	(10,857	)
Manufacturing overhead costs			1,052	(1)
Inventory write-downs			3,088	(1)
Total		$	(6,717	)

 

 

 

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 Sept 30, 2019
Employee severance, other payroll and benefit costs		$	1,714			$	449			$	-			$	(2,002	)		$	161	(1)
Manufacturing overhead costs			-				1,052				-				(1,052	)			-
Gain on sale of Passaic property			-				(11,497	)			245				11,612				(130	) (2)
Other exit and relocation costs			-				191				(465	)			(697	)			(41	) (3)
Sub-total		$	1,714			$	(9,805	)		$	(220	)		$	7,861			$	(10	)
Inventory write-downs
Inventory write-downs		$	-			$	3,088			$	3,088			$	-			$	-
Other Restructuring and Impairment Charges
Lease exit costs (remaining lease rentals)		$	3,145			$	-			$	2,878			$	(267	)		$	-	(4)
Other charges (income)			224				-				-				(53	)			171	(5)
Sub-total			3,369				-				2,878				(320	)			171
Total Restructuring, Impairments and other exit costs		$	5,083			$	(6,717	)		$	5,746			$	7,541			$	161