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Restructuring and Related Charges (Credits)

6 Months Ended

Oct. 31, 2022

Restructuring and Related Activities [Abstract]

Restructuring and Related Charges (Credits)

Restructuring and Related Charges (Credits)

Fiscal Year 2023 Restructuring Program

In May 2022, the Company initiated a global program to restructure and align our cost base with current and anticipated future market conditions (Fiscal Year 2023 Restructuring Program). This program includes the exit of certain leased office space and the reduction of our occupancy at other facilities. We are reducing our real estate square footage occupancy by approximately 22%. In addition, the program includes severance related charges for the elimination of certain positions.

The following tables summarize the pretax restructuring charges related to this program:

			Three Months Ended October 31,						Six Months Ended October 31,						Total Charges Incurred to Date
			2022						2022
Charges by Segment:
Research			$	1,179					$	1,260					$	1,260
Academic & Professional Learning			3,325						9,239						9,239
Education Services			504						1,334						1,334
Corporate Expenses			8,673						23,589						23,589
Total Restructuring and Related Charges			$	13,681					$	35,422					$	35,422
Charges by Activity:
Severance and termination benefits			$	5,467					$	17,564					$	17,564
Impairment of operating lease ROU assets and property and equipment			6,590						12,696						12,696
Acceleration of expense related to operating lease ROU assets and property and equipment			—						1,840						1,840
Facility related charges, net			999						2,697						2,697
Consulting costs			430						430						430
Other activities			195						195						195
Total Restructuring and Related Charges			$	13,681					$	35,422					$	35,422

We recorded an initial pretax restructuring charge of $20.0 million in the three months ended July 31, 2022 related to this program, plus additional impairment and severance charges in the three months ended October 31, 2022 of $12.1 million, for a total of $32.1 million in the six months ended October 31, 2022. These restructuring charges primarily reflect the following charges:

•Severance charges of $17.6 million for the elimination of certain positions,

•Impairment charges of $12.7 million recorded in our corporate category, which included the impairment of operating lease ROU assets of $7.6 million related to certain leases that will be subleased, and the related property and equipment of $5.1 million described further below, and

•Acceleration of expense of $1.8 million, which included the acceleration of rent expense associated with operating lease ROU assets of $0.9 million related to certain leases that will be abandoned or terminated and the related depreciation and amortization of property and equipment of $0.9 million.

Due to the actions taken above, we tested the operating lease ROU assets and the related property and equipment for those being subleased for recoverability by comparing the carrying value of the asset group to an estimate of the future undiscounted cash flows expected to result from the use and eventual disposition of the asset group. Based on the results of the recoverability test, we determined that the undiscounted cash flows of the asset groups were below the carrying values. Therefore, there was an indication of impairment. We then determined the fair value of the asset groups by utilizing the present value of the estimated future cash flows attributable to the assets. The fair value of these operating lease ROU assets and the property and equipment immediately subsequent to the impairment was $12.1 million and was categorized as Level 3 within the FASB ASC Topic 820, “Fair Value Measurements” fair value hierarchy.

In addition, we also incurred ongoing facility-related costs associated with certain properties that resulted in additional restructuring charges of $1.0 million and $2.7 million in the three and six months ended October 31, 2022, respectively. We also incurred consulting costs of $0.4 million in both the three and six months ended October 31, 2022, and other activities of $0.2 million in both the three and six months ended October 31, 2022.

The following table summarizes the activity for the Fiscal Year 2023 Restructuring Program liability for the six months ended October 31, 2022:

			April 30, 2022						Charges						Payments						Foreign Translation & Other Adjustments						October 31, 2022
Severance and termination benefits			$	—					$	17,564					$	(7,871)					$	(113)					$	9,580
Consulting costs			—						430						(430)						—						—
Other activities			—						195						(29)						—						166
Total			$	—					$	18,189					$	(8,330)					$	(113)					$	9,746

The restructuring liability for accrued severance and termination benefits is reflected in Accrued employment costs on our Unaudited Condensed Consolidated Statement of Financial Position. The liability for Other activities is reflected in Other accrued liabilities.

Business Optimization Program

Beginning in fiscal year 2020, we initiated a multiyear Business Optimization Program (the Business Optimization Program) to drive efficiency improvement and operating savings.

The following tables summarize the pretax restructuring charges (credits) related to this program:

			Three Months Ended October 31,												Six Months Ended October 31,												Total Charges Incurred to Date
			2022						2021						2022						2021
Charges (Credits) by Segment:
Research			$	—					$	22					$	—					$	238					$	3,882
Academic & Professional Learning			114						(465)						(10)						(294)						13,240
Education Services			2						6						5						(28)						4,318
Corporate Expenses			159						(896)						980						(1,525)						44,370
Total Restructuring and Related Charges (Credits)			$	275					$	(1,333)					$	975					$	(1,609)					$	65,810
Charges (Credits) by Activity:
Severance and termination benefits			$	127					$	(1,956)					$	13					$	(2,570)					$	35,132
Impairment of operating lease ROU assets and property and equipment			—						—						—						—						15,079
Acceleration of expense related to operating lease ROU assets and property and equipment			—						—						—						—						3,378
Facility related charges, net			148						623						962						961						10,481
Other activities			—						—						—						—						1,740
Total Restructuring and Related Charges (Credits)			$	275					$	(1,333)					$	975					$	(1,609)					$	65,810

The credits in severance and termination benefits activities for the three and six months ended October 31, 2021, primarily reflects changes in the number of headcount reductions and estimates for previously accrued costs.

Facilities related charges, net include sublease income related to those operating leases we had identified in the year ended April 30, 2021 as part of our Business Optimization program that would be subleased.

The following table summarizes the activity for the Business Optimization Program liability for the six months ended October 31, 2022:

			April 30, 2022						Charges						Payments						Foreign Translation & Other Adjustments						October 31, 2022
Severance and termination benefits			$	2,079					$	13					$	(173)					$	(65)					$	1,854
Total			$	2,079					$	13					$	(173)					$	(65)					$	1,854

The restructuring liability for accrued severance and termination benefits is reflected in Accrued employment costs on our Unaudited Condensed Consolidated Statement of Financial Position as of October 31, 2022.

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- References

No definition available.

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- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 5.P.4(e))
-URI http://asc.fasb.org/extlink&oid=115931487&loc=d3e140904-122747

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-URI http://asc.fasb.org/topic&trid=2175745

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869

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