RESTRUCTURING ACTIVITIES AND ASSET IMPAIRMENTS

3 Months Ended

Oct. 31, 2015

Restructuring and Related Activities [Abstract]

Restructuring and Related Activities Disclosure

RESTRUCTURING ACTIVITIES AND ASSET IMPAIRMENTS

2016 cost-saving measures

During the fourth quarter of fiscal 2015, the Company announced that its contract as a distributor to Albertsons Companies, Inc., which includes the Albertsons, Safeway and Eastern Supermarket chains, terminated on September 20, 2015 rather than upon the original contract end date of July 31, 2016. In the first quarter of fiscal 2016, the Company implemented company-wide cost-saving measures in response to this lost business.

The various cost-saving measures implemented in the first quarter of fiscal 2016 resulted in restructuring costs of $2.8 million that were recorded during the three months ended October 31, 2015. These initiatives resulted in a reduction of employees, the majority of which were terminated by October 31, 2015, across the Company. The total work-force reduction charge of $2.3 million during the three months ended October 31, 2015 was primarily related to severance and fringe benefits. The Company also delayed filling vacant positions during the first quarter of fiscal 2016. In connection with these initiatives, we expect to incur additional costs of $1.2 million to $2.2 million related to severance and fringe benefits in the remainder of fiscal 2016. In addition to workforce reduction charges, the Company also recorded $0.5 million for an early lease termination charge and operational transfer costs associated with these initiatives in the first quarter of fiscal 2016.

The following is a summary of the restructuring costs the Company recorded in the first quarter of fiscal 2016, as well as the remaining liability as of October 31, 2015 (in thousands):



	Restructuring Costs		Cash Payments			Restructuring Cost Liability as of October 31, 2015
Severance	$	2,285	$	(732	)	$	1,553
Early lease termination	225		—			225
Operational transfer costs	299		(299		)	—
Total	$	2,809	$	(1,031	)	$	1,778

The Company anticipates that the remaining liability related to the workforce reduction will be substantially paid by the end of fiscal 2016. The early lease termination charge was paid in the second quarter of fiscal 2016, prior to the filing of this Quarterly Report.

Canadian facility closure

During fiscal 2015, the Company ceased operations at its Canadian facility located in Scotstown, Quebec which was acquired in 2010. In connection with this closure, the Company recognized an impairment of $0.6 million during the first quarter of fiscal 2015 representing the remaining unamortized balance of an intangible asset.