Restructuring and Other Expense

9 Months Ended

Feb. 28, 2017

Restructuring and Other Expense

NOTE D – Restructuring and Other Expense

We consider restructuring activities to be programs whereby we fundamentally change our operations such as closing and consolidating manufacturing facilities, moving manufacturing of a product to another location, and rationalizing headcount.

A progression of the liabilities associated with our restructuring activities, combined with a reconciliation to the restructuring and other expense financial statement caption in our consolidated statement of earnings for the nine months ended February 28, 2017 is summarized as follows:

(in thousands)	Beginning Balance		Expense		Payments			Adjustments		Ending Balance (1)
Early retirement and severance	$	1,831	$	1,795	$	(3,071	)	$	58	$	613
Facility exit and other costs		653		3,190		(3,369	)		45		519
	$	2,484		4,985	$	(6,440	)	$	103	$	1,132
Net loss on sale of assets				1,009
Restructuring and other expense			$	5,994

1) The total liability as of February 28, 2017 is expected to be paid in the next twelve months.

During the nine months ended February 28, 2017, the following activities were taken related to the Company’s restructuring activities:

• The Company announced certain organizational changes impacting its Pressure Cylinders operating segment, including the consolidation of the Cryogenics business unit into the Industrial Products business unit. In connection with this matter, the Company recognized severance expense of $1,356,000 related to permanent headcount reductions.

• In connection with the closure of the Company’s stainless steel business, Precision Specialty Metals, Inc. (“PSM”), the Company recognized $1,666,000 of facility exit costs and a credit to severance expense of $106,000.

• In connection with the closure of the Engineered Cabs facility in Florence, South Carolina, the Company recognized facility exit costs of $459,000. The Company also recognized a net loss of $101,000 related to the disposal of assets.

• In connection with the consolidation of the Company’s existing cryogenics facility in Istanbul, Turkey, to its Greenfield facility in Bandirma, Turkey, the Company recognized facility exit costs of $1,113,000 and severance expense of $640,000. The consolidation is substantially complete.

• The Company sold the remaining real estate of the legacy Advanced Component Technologies, Inc. (“ACT”) business within Engineered Cabs for cash proceeds of $700,000, resulting in a loss of $822,000.

• In connection with other non-significant restructuring activities, the Company recognized a credit to severance expense of $95,000 and a credit to facility exit costs of $48,000. The Company also recognized a net loss on disposal of assets of $86,000.