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Restructuring and Related Charges and Asset Impairment Charges

12 Months Ended

Jun. 30, 2021

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 fiscal 2020 substantially completed, the FY20 Restructuring Actions 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 $54.8 million were recorded for this program through June 30, 2021, consisting of: $46.6 million in Metal Cutting and $8.3 million in Infrastructure.

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 to reduce structural costs. Subsequently, we also announced the acceleration of our other structural cost reduction plans including the closing of the Johnson City, Tennessee facility. Expected pre-tax charges for the FY21 Restructuring Actions are approximately $90 million. Total restructuring and related charges since inception of $82.2 million were recorded for this program through June 30, 2021, consisting of: $74.5 million in Metal Cutting and $7.7 million in Infrastructure. The majority of the remaining charges related to the FY21 Restructuring Actions are expected to be in the Metal Cutting segment.

Annual Restructuring Charges

During 2021, we recorded restructuring and related charges of $40.4 million, which consisted of $35.6 million in Metal Cutting and $4.8 million in Infrastructure. Of this amount, restructuring charges totaled $29.6 million, of which $0.5 million was related to inventory and was recorded in cost of goods sold. Restructuring-related charges of $10.8 million were recorded in cost of goods sold.

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 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.

As of June 30, 2021, $19.9 million the restructuring accrual is recorded in other current liabilities and $9.9 million is recorded in other liabilities in our consolidated balance sheet. 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. The amounts are as follows:

(in thousands)			June 30, 2020						Expense, net						Asset Write-Down												Translation						Cash Expenditures						June 30, 2021
Severance			$	47,303					$	23,917					$	—											$	2,445					$	(43,942)					$	29,723
Facilities			—						5,664						(5,664)												—						—						—
Other			63						—						—												2						(65)						—
Total			47,366						29,581						(5,664)												2,447						(44,007)						29,723

(in thousands)			June 30, 2019						Expense						Asset Write-Down												Translation						Cash Expenditures						June 30, 2020
Severance			$	19,125					$	66,129					$	—											$	(397)					$	(37,554)					$	47,303
Facilities			—						3,039						(3,039)												—						—						—
Other			87						6																		(2)						(28)						63
Total			19,212						69,174						(3,039)												(399)						(37,582)						47,366

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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://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-URI http://asc.fasb.org/topic&trid=2175745

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- References

No definition available.

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