Restructuring and Other Charges

6 Months Ended

Sep. 26, 2020

Restructuring and Related Activities [Abstract]

Restructuring and Other Charges

Restructuring and Other Charges

A description of significant restructuring and other activities and their related costs is provided below.

Fiscal 2021 Strategic Realignment Plan

The Company has begun efforts to realign its resources to support future growth and profitability, and to create a sustainable cost structure. The key areas of the Company's evaluation include its: (i) team organizational structures and ways of working; (ii) real estate footprint and related costs across distribution centers, corporate offices, and direct-to-consumer retail and wholesale doors; and (iii) brand portfolio.

In connection with the first initiative, on September 17, 2020, the Company's Board of Directors approved a restructuring plan (the "Fiscal 2021 Strategic Realignment Plan") to reduce its global workforce by the end of Fiscal 2021. In connection with the reduction in workforce, the Company expects to incur total estimated pre-tax charges of up to approximately $160 million, primarily consisting of cash-related severance and benefit costs. Additionally, during its preliminary review of its store portfolio, the Company made the decision to close its Polo store on Regent Street in London.

In addition to these actions, the Company anticipates additional restructuring-related actions associated with the other aforementioned initiatives as part of the Fiscal 2021 Strategic Realignment Plan.

A summary of the charges recorded in connection with the Fiscal 2021 Strategic Realignment Plan during the fiscal periods presented (inclusive of immaterial other restructuring-related charges previously recorded during the first quarter of Fiscal 2021) is as follows:

	September 26, 2020
	Three Months Ended		Six Months Ended
	(millions)
Cash-related restructuring charges:
Severance and benefit costs	$	153.8	$	156.3
Other cash charges	3.8		3.9
Total cash-related restructuring charges	157.6		160.2
Non-cash charges:
Impairment of assets (see Note 7)	22.2		24.3
Inventory-related charges(a)	—		1.3
Total non-cash charges	22.2		25.6
Total charges	$	179.8	$	185.8

^(a)  Inventory-related charges are recorded within cost of goods sold in the consolidated statements of operations.

A summary of current period activity in the restructuring reserve related to the Fiscal 2021 Strategic Realignment Plan is as follows:

	Severance and Benefit Costs			Other Cash Charges			Total
	(millions)
Balance at March 28, 2020	$	—		$	—		$	—
Additions charged to expense	156.3			3.9			160.2
Cash payments charged against reserve	(2.6		)	(0.2		)	(2.8		)
Non-cash adjustments	(0.3		)	—			(0.3		)
Balance at September 26, 2020	$	153.4		$	3.7		$	157.1

Fiscal 2019 Restructuring Plan

On June 4, 2018, the Company's Board of Directors approved a restructuring plan associated with the Company's strategic objective of operating with discipline to drive sustainable growth (the "Fiscal 2019 Restructuring Plan"). The Fiscal 2019 Restructuring Plan included the following restructuring-related activities: (i) rightsizing and consolidation of the Company's global distribution network and corporate offices; (ii) targeted severance-related actions; and (iii) closure of certain of its stores and shop-within-shops.

Actions associated with the Fiscal 2019 Restructuring Plan are complete and no additional charges are expected to be incurred in connection with this plan. A summary of the charges recorded in connection with the Fiscal 2019 Restructuring Plan during the fiscal periods presented, as well as the cumulative charges recorded since its inception, is as follows:

	September 28, 2019
	Three Months Ended		Six Months Ended		Cumulative Charges
	(millions)
Cash-related restructuring charges:
Severance and benefit costs	$	9.0	$	14.9	$	90.3
Lease termination and store closure costs	0.2		0.5		2.3
Other cash charges	0.3		1.1		10.8
Total cash-related restructuring charges	9.5		16.5		103.4
Non-cash charges:
Impairment of assets (see Note 7)	2.3		3.5		19.0
Inventory-related charges(a)	0.4		1.0		8.2
Accelerated stock-based compensation expense(b)	3.6		3.6		3.6
Loss on sale of property(c)	—		—		11.6
Total non-cash charges	6.3		8.1		42.4
Total charges	$	15.8	$	24.6	$	145.8

^(a)  Inventory-related charges are recorded within cost of goods sold in the consolidated statements of operations.

^(b)  Accelerated stock-based compensation expense, which is recorded within restructuring and other charges in the consolidated statements of operations, was recorded in connection with vesting provisions associated with certain separation agreements.

^(c)  Loss on sale of property, which was recorded within restructuring and other charges in the consolidated statements of operations, was incurred in connection with the sale of one of the Company's distribution centers in North America.

A summary of current period activity in the restructuring reserve related to the Fiscal 2019 Restructuring Plan is as follows:

	Severance and Benefit Costs			Other Cash Charges			Total
	(millions)
Balance at March 28, 2020	$	23.5		$	0.6		$	24.1
Additions charged to expense	—			—			—
Cash payments charged against reserve	(14.0		)	(0.6		)	(14.6		)
Balance at September 26, 2020	$	9.5		$	—		$	9.5

Other Charges

The Company recorded other charges of $2.9 million and $7.3 million during the three-month and six-month periods ended September 26, 2020, respectively, and $1.4 million and $3.2 million during the three-month and six-month periods ended September 28, 2019, respectively, primarily related to rent and occupancy costs associated with certain previously exited real estate locations for which the related lease agreements have not yet expired.

The Company also recorded other charges of $20.8 million during the six months ended September 28, 2019 related to the donation of net cash proceeds received from the sale of its corporate jet. This donation was made to the Ralph Lauren Corporate Foundation (formerly known as the Polo Ralph Lauren Foundation), a non-profit, charitable foundation that supports various philanthropic programs.