Restructuring and Other Expense

12 Months Ended

May 31, 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 or moving manufacturing of a product to another location. Restructuring activities may also involve substantial realignment of the management structure of a business unit in response to changing market conditions.

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 fiscal 2017, is summarized below:

(in thousands)	Beginning Balance		Expense		Payments			Adjustments		Ending Balance
Early retirement and severance	$	1,831	$	1,854	$	(3,505	)	$	73	$	253
Facility exit and other costs		653		3,752		(3,916	)		47		536
	$	2,484		5,606	$	(7,421	)	$	120	$	789
Net loss on sale of assets				805
Restructuring and other expense			$	6,411

During fiscal 2017, the following actions 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 $1,999,000 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 $504,000. The Company also recognized a net gain of $104,000 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 $1,299,000 and severance expense of $699,000. 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 $50,000. The Company also recognized a net loss on disposal of assets of $87,000.

The total liability as of May 31, 2017 is expected to be paid in the next twelve months.