XML 39 R23.htm IDEA: XBRL DOCUMENT v3.20.2
Restructuring and Related Charges and Asset Impairment Charges
 12 Months Ended
Jun. 30, 2020
Restructuring Charges [Abstract]  
RESTRUCTURING AND RELATED CHARGES AND ASSET IMPAIRMENT CHARGES RESTRUCTURING AND RELATED CHARGES
FY20 Restructuring Actions
In the June quarter of fiscal 2019, we implemented and in the current fiscal year substantially completed restructuring activities associated with our simplification/modernization initiative to reduce structural costs, improve operational efficiency and position us for long-term profitable growth. Total restructuring and related charges since inception of $53.5 million were recorded for this program through June 30, 2020, consisting of: $43.1 million in Industrial, $8.2 million in Infrastructure and $2.2 million in Widia. FY20 Restructuring Actions are substantially complete as of June 30, 2020.
FY21 Restructuring Actions
In the September quarter of fiscal 2020, we announced the initiation of restructuring actions in Germany associated with our simplification/modernization initiative, which are expected to reduce structural costs. We agreed with local employee representatives to downsize our Essen, Germany operations instead of the previously proposed closure. During the fourth quarter of fiscal 2020, we also announced the acceleration of our structural cost reduction plans and increased the expected pre-tax charges to $90 million to $100 million. These actions are to be completed by the end of fiscal 2021 and are expected to be primarily cash expenditures.
Total restructuring and related charges since inception of $43.2 million were recorded for this program through June 30, 2020, consisting of: $37.9 million in Industrial, $3.0 million in Infrastructure and $2.3 million in Widia.
Annual Restructuring Charges
During 2020, we recorded restructuring and related charges of $83.3 million. Of this amount, restructuring charges totaled $69.2 million, of which $0.9 million was related to inventory and was recorded in cost of goods sold. Restructuring-related charges of $14.1 million were recorded in cost of goods sold.
During 2019, we recorded restructuring and related charges of $16.9 million, net of a $4.8 million gain on the sale of our previously closed Madison, AL manufacturing location as part of our FY19 Restructuring Actions. Of this amount, restructuring charges totaled $19.5 million, of which $0.7 million was related to inventory and was recorded in cost of goods sold. Restructuring-related charges of $1.8 million were recorded in cost of goods sold and $0.3 million were recorded in operating expense during 2019.
During 2018, we recorded restructuring and related charges of $15.9 million, net of a $4.7 million gain on the sale of our previously closed Houston, TX manufacturing location as part of our legacy restructuring programs. Of this amount, restructuring charges totaled $16.4 million, of which benefit of $0.2 million was related to inventory and was recorded in cost of goods sold. Restructuring-related charges of $3.7 million were recorded in cost of goods sold and $0.5 million were recorded in operating expense during 2018.
As of June 30, 2020, $34.9 million of the restructuring accrual is recorded in other current liabilities and $12.5 million is recorded in other liabilities in our consolidated balance sheet. As of June 30, 2019, the restructuring accrual of $19.2 million is recorded in other current liabilities. The amount attributable to each segment is as follows:
(in thousands)
June 30, 2019
 
Expense
 
Asset Write-Down
 
Translation
 
Cash Expenditures
 
June 30, 2020
Industrial
 
 
 
 
 
 
 
 
 
 
 
Severance
$
8,863

 
$
58,308

 
$
—

 
$
(331
)
 
$
(30,742
)
 
$
36,098

Facilities
—

 
2,096

 
(2,096
)
 
—

 
—

 
—

Other
35

 
4

 
—

 
(1
)
 
(23
)
 
15

Total Industrial
8,898

 
60,408

 
(2,096
)
 
(332
)
 
(30,765
)
 
36,113

 
 
 
 
 
 
 
 
 
 
 
 
Widia
 
 
 
 
 
 
 
 
 
 
 
Severance
2,306

 
2,627

 
—

 
88

 
(1,696
)
 
3,325

Facilities
—

 
51

 
(51
)
 
—

 
—

 
—

Other
24

 
—

 
—

 
—

 
—

 
24

Total Widia
2,330

 
2,678

 
(51
)
 
88

 
(1,696
)
 
3,349

 
 
 
 
 
 
 
 
 
 
 
 
Infrastructure
 
 
 
 
 
 
 
 
 
 
 
Severance
7,956

 
5,194

 
—

 
(154
)
 
(5,116
)
 
7,880

Facilities
—

 
892

 
(892
)
 
—

 
—

 
—

Other
28

 
2

 
—

 
(1
)
 
(5
)
 
24

Total Infrastructure
7,984

 
6,088

 
(892
)
 
(155
)
 
(5,121
)
 
7,904

Total
$
19,212

 
$
69,174

 
$
(3,039
)
 
$
(399
)
 
$
(37,582
)
 
$
47,366


(in thousands)
June 30, 2018
 
Expense
 
Asset Write-Down
 
Translation
 
Cash Expenditures
 
June 30, 2019
Industrial
 
 
 
 
 
 
 
 
 
 
 
Severance
$
7,967

 
$
8,957

 
$
—

 
$
(176
)
 
$
(7,885
)
 
$
8,863

Facilities
—

 
3,488

 
(3,488
)
 
—

 
—

 
—

Other
—

 
(103
)
 
—

 
(1
)
 
139

 
35

Total Industrial
7,967

 
12,342

 
(3,488
)
 
(177
)
 
(7,746
)
 
8,898

 
 
 
 
 
 
 
 
 
 
 
 
Widia
 
 
 
 
 
 
 
 
 
 
 
Severance
2,087

 
2,185

 
—

 
(43
)
 
(1,923
)
 
2,306

Facilities
—

 
401

 
(401
)
 
—

 
—

 
—

Other
15

 
(25
)
 
—

 
—

 
34

 
24

Total Widia
2,102

 
2,561

 
(401
)
 
(43
)
 
(1,889
)
 
2,330

 
 
 
 
 
 
 
 
 
 
 
 
Infrastructure
 
 
 
 
 
 
 
 
 
 
 
Severance
7,558

 
3,977

 
—

 
(78
)
 
(3,501
)
 
7,956

Facilities
—

 
708

 
(708
)
 
—

 
—

 
—

Other
12

 
(46
)
 
—

 
—

 
62

 
28

Total Infrastructure
7,570

 
4,639

 
(708
)
 
(78
)
 
(3,439
)
 
7,984

Total
$
17,639

 
$
19,542

 
$
(4,597
)
 
$
(298
)
 
$
(13,074
)
 
$
19,212