Restructuring and Related Charges

9 Months Ended

Sep. 30, 2022

Restructuring and Related Activities [Abstract]

In the third quarter of 2020, the Company began implementing a restructuring plan in an effort to reduce the ongoing operating costs of the Company to align with changes in enrollment following the COVID-19 pandemic. Under this plan, the Company incurred severance and other employee separation costs related to voluntary and involuntary employee terminations.

In addition, the 2020 restructuring plan included an evaluation of the Company's owned and leased real estate portfolio, which resulted in the consolidation and sale of underutilized facilities. The Company recorded right-of-use lease asset charges of approximately $1.9 million and $18.9 million during the three and nine months ended September 30, 2021, respectively, and approximately $0.1 million and $1.2 million during the three and nine months ended September 30, 2022, respectively, related to facilities consolidated as a result of the restructuring plan. The Company also recorded fixed asset impairment charges of approximately $0.6 million and $2.6 million during the three and nine months ended September 30, 2021, respectively, and approximately $0.1 million and $2.5 million during the three and nine months ended September 30, 2022, respectively. During the three and nine months ended September 30, 2021, the Company recorded a $0.7 million gain from the sale of property and equipment of an owned campus that was closed in connection with the 2020 restructuring plan. All severance and other employee separation charges, right-of-use lease asset and fixed asset impairment charges, and gains on the sale of property and equipment related to the 2020 restructuring plan are included in Restructuring costs on the unaudited condensed consolidated statements of income.

The following details the changes in the Company’s severance and other employee separation costs restructuring liabilities during the nine months ended September 30, 2021 and 2022 (in thousands):


	CEC Integration Plan(1)		2020 Restructuring Plan		Total
Balance at December 31, 2020	$	1,835	$	1,287	$	3,122
Restructuring and other charges	—		3,737		3,737
Payments	(1,835)		(4,227)		(6,062)
Balance at September 30, 2021	$	—	$	797	$	797

Balance at December 31, 2021(2)	$	—	$	1,612	$	1,612
Restructuring and other charges	—		1,241		1,241
Payments	—		(2,853)		(2,853)
Balance at September 30, 2022	$	—	$	—	$	—

_____________________________________

(1)Restructuring plan implemented following the Company's merger with CEC.

(2)Restructuring liabilities are included in accounts payable and accrued expenses.