Restructuring And Other Expense (Income)

6 Months Ended

Nov. 30, 2011

Restructuring And Other Expense (Income) [Abstract]

Restructuring And Other Expense (Income)

NOTE C – Restructuring and Other Expense (Income)

In fiscal 2008, we initiated a Transformation Plan (the "Transformation Plan") with the overall goal to improve our sustainable earnings potential, asset utilization and operational performance. The Transformation Plan focuses on cost reduction, margin expansion and organizational capability improvements and, in the process, seeks to drive excellence in three core competencies: sales; operations; and supply chain management. The Transformation Plan is comprehensive in scope and included aggressive diagnostic and implementation phases.

During the six months ended November 30, 2011, the following actions were taken in connection with the Transformation Plan:

• We engaged a consulting firm to assist with the ongoing transformation efforts within our Pressure Cylinders operating segment. As a result, we incurred professional fees of $3,785,000, which were classified as restructuring and other expense in our consolidated statements of earnings. Services provided included assistance through diagnostic tools, performance improvement technologies, project management techniques, benchmarking information and insights that directly related to the Transformation Plan.

• The following actions were taken in connection with the wind-down of our Metal Framing operating segment:

- Approximately $5,215,000 of facility exit and other costs were incurred in connection with the closure of the retained facilities.

- The severance accrual was adjusted downward, resulting in a $1,041,000 credit to earnings.

- Certain assets of the retained facilities classified as held for sale were disposed of for cash proceeds of $2,867,000 resulting in a net gain of $1,385,000.

- The assets of our Vinyl division, which were also classified as held for sale, were sold to our unconsolidated affiliate, ClarkDietrich, for cash proceeds of $6,125,000 resulting in a gain of $766,000.

These items were recognized within the joint venture transactions line item in our consolidated statements of earnings to correspond with amounts previously recognized in connection with the formation of ClarkDietrich and the subsequent wind-down of our Metal Framing operating segment.

A progression of the liabilities created as part of the Transformation Plan during the six months ended November 30, 2011, combined with a reconciliation to the restructuring and other expense (income) line item in our consolidated statement of earnings is summarized in the following table:

	Beginning		Expense/								Ending
(in thousands)	Balance		(Income)			Payments			Adjustments		Balance
Early retirement and severance	$	7,220	$	(1,041	)	$	(2,577	)	$	1,588	$	5,190
Facility exit and other costs		409		5,181			(5,215	)		33		408
Professional fees		-		3,785			(3,050	)		13		748
	$	7,629		7,925		$	(10,842	)	$	1,634	$	6,346
Net gain on sale of assets				(2,151	)
Total restructuring charges				5,774
Joint venture transactions				(2,023	)
Restructuring and other expense			$	3,751

The adjustment to the early retirement and severance line item above relates to the reclassification of severance costs to be reimbursed by MISA in connection with the ClarkDietrich formation to the assets section of the balance sheet during the six months ended November 30, 2011.