ASSET IMPAIRMENT AND RESTRUCTURING

On June 1, 2017, the Company announced a plan to restructure its ivivva operations. On August 20, 2017, as part of this plan, the Company closed 48 of its 55 ivivva branded company-operated stores. The seven remaining ivivva branded stores remain in operation and are not expected to close. All of the Company's ivivva branded showrooms and other temporary locations have been closed. The restructuring is substantially complete, and the Company continues to offer ivivva branded products on its e-commerce websites and through the remaining ivivva branded stores.

As a result of the closures, the Company recognized aggregate pre-tax charges of $47.2 million during fiscal 2017. A summary of the pre-tax charges recognized during fiscal 2017 in connection with the Company's restructuring of its ivivva operations is as follows:



	Fiscal Year Ended January 28, 2018
	(In thousands)
Costs recorded in cost of goods sold:
Provision to reduce inventories to net realizable value	$	4,945
Accelerated depreciation	3,753
	8,698
Costs recorded in operating expenses:
Lease termination costs	21,069
Impairment of property and equipment	11,593
Employee related costs	4,226
Other restructuring costs	1,637
Asset impairment and restructuring costs	38,525
Restructuring and related costs	$	47,223

Income tax recoveries of $12.7 million were recorded on the above items in fiscal 2017. These income tax recoveries are based on the annual tax rate of the applicable tax jurisdictions.

Costs recorded in cost of goods sold

During fiscal 2017, the Company recognized expenses of $8.7 million in cost of goods sold as a result of the restructuring of its ivivva operations. This included $4.9 million to reduce inventories to their estimated net realizable value, and $3.8 million in accelerated depreciation primarily related to leasehold improvements and furniture and fixtures for stores that were closed on August 20, 2017.

Costs recorded in operating expenses

The Company recognized asset impairment and restructuring costs of $38.5 million during fiscal 2017 as a result of the restructuring of its ivivva operations.

As a result of the plan to close the majority of the ivivva branded locations, the long-lived assets of each ivivva branded location were tested for impairment as of April 30, 2017. For impaired locations, a loss was recognized representing the difference between the net book value of the long-lived assets and their estimated fair value. Impairment losses totaling $11.6 million were recognized during the first quarter of fiscal 2017. These losses primarily relate to leasehold improvements and furniture and fixtures of the company-operated stores segment. These assets were retired during fiscal 2017 in conjunction with the closures of the company-operated stores.

During fiscal 2017, the Company recognized employee related expenses as a result of the restructuring of $4.2 million.

The Company recognized lease termination costs of $21.1 million during fiscal 2017. As of January 28, 2018, the Company had lease termination liabilities of $6.4 million. During fiscal 2017, the Company also recognized other restructuring costs of $1.6 million.