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Note 14 - Restructuring and Other Charges, Net of Gains | 3 Months Ended
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Dec. 31, 2023
Notes to Financial Statements |
Restructuring, Impairment, and Other Activities Disclosure [Text Block] |
(14) | Restructuring and Other Charges, Net of Gains
Restructuring and other charges, net of gains were as follows (in thousands):
|  | Three months ended December 31, |  |  | Six months ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Orleans, Vermont flood |  | $ | 250 |  |  | $ | - |  |  | $ | 2,346 |  |  | $ | - |
Gain on sale-leaseback transaction |  |  | (655 | ) |  |  | (654 | ) |  |  | (1,310 | ) |  |  | (2,911 | )
Severance and other charges |  |  | 170 |  |  |  | 458 |  |  |  | 221 |  |  |  | 719 |
Total Restructuring and other charges, net of gains |  | $ | (235 | ) |  | $ | (196 | ) |  | $ | 1,257 |  |  | $ | (2,192 | )
Activity within restructuring and other charges, net of gains are summarized in the table below (in thousands):
|  | Balance |  |  | Fiscal 2024 Activity |  |  | Balance |  |
|  | June 30, 2023 |  |  | Expenses/(Gain) |  |  | Non-Cash |  |  | Payments |  |  | Receipts |  |  | December 31, 2023 |  |
Orleans, Vermont flood(1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Inventory write-downs and overhead manufacturing costs |  | $ | - |  |  | $ | 1,426 |  |  | $ | 1,426 |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |
Repair and remediation costs |  |  | - |  |  |  | 2,415 |  |  |  | - |  |  |  | (2,330 | ) |  |  | - |  |  |  | 85 |  | (1)
Insurance recoveries and grant proceeds |  |  | - |  |  |  | (1,495 | ) |  |  | - |  |  |  | - |  |  |  | 1,405 |  |  |  | (90 | ) | (2)
Sub-total |  | $ | - |  |  | $ | 2,346 |  |  | $ | 1,426 |  |  | $ | (2,330 | ) |  | $ | 1,405 |  |  | $ | (5 | ) |
Gain on sale-leaseback transaction |  | $ | 2,838 |  |  | $ | (1,310 | ) |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 1,528 |  | (3)
Severance and other charges |  |  | 321 |  |  |  | 221 |  |  |  | - |  |  |  | (258 | ) |  |  | - |  |  |  | 284 |  |
Total Restructuring and other charges, net of gains |  | $ | 3,159 |  |  | $ | 1,257 |  |  | $ | 1,426 |  |  | $ | (2,588 | ) |  | $ | 1,405 |  |  | $ | 1,807 |  |
(1) | In July 2023, our wood furniture manufacturing operations located in Orleans, Vermont sustained damage from flooding of the nearby Barton River. In addition to losses related to wood furniture inventory parts and state-of-the-art manufacturing equipment, the flooding also resulted in a temporary work stoppage for many Vermont associates and a disruption and delay of shipments. Losses incurred from the disposal of damaged inventory, inoperable machinery equipment from water damage, facility cleanup, and restoration, was $2.3 million, net of insurance recoveries and grant proceeds. The remaining amount of repair and remediation costs to be paid as of December 31, 2023 is accrued for within Accounts payable and accrued expenses.
(2) | The Vermont Department of Economic Development awarded Ethan Allen a $0.5 million grant through its Business Emergency Gap Assistance Program. These funds were used toward the cleanup and restoration efforts. Insurance proceeds received during fiscal 2024 totaled $1.4 million with an additional $0.1 million to be received by Ethan Allen within the next three months, which is reflected within Prepaid expenses and other current assets.
(3) | In August 2022, we sold and subsequently leased back a retail design center and recognized a net gain of $1.3 million for the six months ended December 31, 2023. The remaining deferred liability of $1.5 million as of December 31, 2023 is recorded within Other current liabilities on our consolidated balance sheet and will be recognized over the remaining life of the lease. Refer to Note 6, Leases, for further discussion on the sale-leaseback transaction.

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