Restructuring and Related Charges

12 Months Ended

Aug. 31, 2017

Restructuring and Related Charges [Abstract]

15. Restructuring and Related Charges

Following is a summary of the Company’s restructuring and related charges (in thousands):

			Fiscal Year Ended August 31,
			2017⁽²⁾		2016⁽³⁾		2015⁽³⁾
	Employee severance and benefit costs		$	56,834	$	8,845	$	24,327
	Lease costs			3,966		(43)		2,777
	Asset write-off costs			94,346		1,170		5,565
	Other related costs			5,249		1,397		1,890
		Total restructuring and related charges⁽¹⁾	$	160,395	$	11,369	$	34,559

⁽¹⁾Includes $51.3 million, $10.7 million and $32.0 million recorded in the EMS segment, $82.4 million, $0.8 million and $0.4 million recorded in the DMS segment and $26.7 million, $(0.1) million and $2.2 million of non-allocated charges for the fiscal years ended August 31, 2017, 2016 and 2015, respectively. Except for asset write-off costs, all restructuring and related charges are cash costs.

⁽²⁾ Includes employee severance and benefit costs of $52.2 million and $4.6 million, lease costs of $4.0 million and $0.0 million, asset write-off costs of $94.2 million and $0.1 million and other related costs of $3.8 million and $1.5 million for the 2017 Restructuring Plan and the 2013 Restructuring Plan, respectively.

⁽³⁾ Costs relate to the 2013 Restructuring Plan.

2017 Restructuring Plan

On September 15, 2016, the Company’s Board of Directors formally approved a restructuring plan to better align the Company’s global capacity and administrative support infrastructure to further optimize organizational effectiveness. This action includes headcount reductions across the Company’s Selling, General and Administrative cost base and capacity realignment in higher cost locations (the “2017 Restructuring Plan”).

Upon completion of the 2017 Restructuring Plan, the Company expects to recognize approximately $195.0 million in restructuring and other related costs. The Company incurred $154.2 million of costs during fiscal year 2017 and anticipates incurring the remaining costs during fiscal year 2018

2013 Restructuring Plan

The Company’s Board of Directors approved a restructuring plan in fiscal year 2013 (the “2013 Restructuring Plan”), which was intended to better align the Company’s manufacturing capacity in certain geographies and to reduce the Company’s worldwide workforce in order to reduce operating expenses. As of August 31, 2017, the 2013 Restructuring Plan was substantially complete.

The table below sets forth the cumulative restructuring and related charges incurred through August 31, 2017 for the 2017 Restructuring Plan and the 2013 Restructuring Plan (in thousands):


		2017		2013
		Restructuring Plan⁽¹⁾		Restructuring Plan⁽²⁾		Total
Employee severance and benefit costs		$	52,197	$	137,138	$	189,335
Lease costs			3,966		3,484		7,450
Asset write-off costs			94,276		21,385		115,661
Other related costs			3,792		6,021		9,813
Total restructuring and related charges		$	154,231	$	168,028	$	322,259

⁽¹⁾	Includes $45.1 million allocated to the EMS segment, $82.4 million allocated to the DMS segment and $26.7 million of unallocated costs.
⁽²⁾	Includes $130.3 million allocated to the EMS segment, $28.8 million allocated to the DMS segment and $8.9 million of unallocated costs.

	The tables below summarize the Company’s liability activity associated with the 2017 Restructuring Plan and the 2013
Restructuring Plan (in thousands):


				Employee Severance				Asset Write-off		Other
				and Benefit Costs		Lease Costs		Costs		Related Costs		Total
		Balance as of August 31, 2015⁽¹⁾		$	30,047	$	64	$	―	$	846	$	30,957
			Restructuring related charges		8,845		(43)		1,170		1,397		11,369
			Asset write-off charge and other
			non-cash activity		(454)		―		(1,170)		―		(1,624)
			Cash payments		(21,172)		―		―		(1,503)		(22,675)
		Balance as of August 31, 2016⁽¹⁾			17,266		21		―		740		18,027
			Restructuring related charges		56,834		3,966		94,346		5,249		160,395
			Asset write-off charge and other
			non-cash activity		1,319		59		(94,346)		65		(92,903)
			Cash payments		(41,839)		(2,381)		―		(2,911)		(47,131)
		Balance as of August 31, 2017⁽²⁾		$	33,580	$	1,665	$	―	$	3,143	$	38,388

⁽¹⁾Relates only to the 2013 Restructuring Plan.

⁽²⁾ The liability as of August 31, 2017 includes $30.9 million and $7.5 million related to the 2017 Restructuring Plan and the 2013 Restructuring Plan, respectively.