Lands' End Japan Closure

12 Months Ended

Feb. 02, 2024

Restructuring and Related Activities [Abstract]

NOTE 8. LANDS’ END JAPAN CLOSURE

In July 2022, the Board of Directors approved a plan to cease operations of Lands’ End Japan KK, a subsidiary of Lands’ End, Inc. (“Lands’ End Japan”) by the end of Fiscal 2022. Lands’ End Japan comprises the Japan eCommerce operating segment. For a discussion of this operating segment, see Note 13, Segment Reporting. The closing and subsequent disposal of the assets does not represent a strategic shift with a major effect on the consolidated financial condition. Accordingly, the closing of Lands’ End Japan was not presented in the Consolidated Financial Statements as discontinued operations.

In August 2022, the Company notified all employees of the closure and commenced closing activities. Liquidation sales commenced in the month of September 2022 through the end of Fiscal 2022. The dissolution of Lands’ End Japan was authorized and approved on January 31, 2023. The Company recorded closing costs for employee severance and benefit costs, early termination and restoration costs of lease facilities and contract cancellation and other costs. The final liquidation occurred in First Quarter 2024.

The following table summarizes the closing costs of Lands’ End Japan recognized in Other operating expense, net in the Consolidated Statement of Operations for Fiscal 2023 and Fiscal 2022.


(in thousands)	February 2, 2024			January 27, 2023
Employee severance and benefit costs (1)	$	25		$	1,795
Early termination and restoration costs of leased facilities		(16	)		744
Contract cancellation and other costs		259			448
Total closing costs	$	268		$	2,987

(1)

For fiscal year ending January 27, 2023 employee severance and benefit costs are approximately $1.0 million lower than actual payments due to the reversal of a previously recorded compensation-related accrual.

The following table summarizes the accrued closing cost activity related to Lands’ End Japan included in Accrued expenses and other current liabilities in the Consolidated Balance Sheets:


(in thousands)	Employee Severance and Benefit Costs			Leased Facilities Costs			Other Closing Costs			Total
Balance as of January 28, 2022	$	—		$	—		$	—		$	—
Estimated costs payable in cash		2,812			749			347			3,908
Cash payments		(2,076	)		(381	)		(379	)		(2,836	)
Foreign currency translation		331			104			49			484
Balance as of January 27, 2023	$	1,067		$	472		$	17		$	1,556
Estimated costs payable in cash		25			(16	)		259			268
Cash payments		(1,050	)		(438	)		(260	)		(1,748	)
Foreign currency translation		(14	)		(18	)		(1	)		(33	)
Balance as of February 2, 2024	$	28		$	—		$	15		$	43