Restructuring, Impairment, and Other Exit Costs

6 Months Ended

Nov. 28, 2021

Restructuring, Impairment, and Other Exit Costs [Abstract]

Restructuring, Impairment, and Other Exit Costs

(3) Restructuring, Impairment, and Other Exit Costs

Restructuring charges were as follows:

	Quarter Ended				Six-Month Period Ended
In Millions	Nov. 28, 2021		Nov. 29, 2020		Nov. 28, 2021		Nov. 29, 2020
Asia & Latin America manufacturing and logistics operations	$	12.6	$	-	$	12.6	$	-
(Recoveries) charges associated with restructuring actions previously announced		(9.9)		0.9		(14.0)		1.9
Total restructuring charges (recoveries)	$	2.7	$	0.9	$	(1.4)	$	1.9

In the second quarter of fiscal 2022, we approved restructuring actions in the Asia & Latin America segment to drive efficiencies in manufacturing and logistics operations. We expect to incur approximately $21 million of restructuring charges and project-related costs related to these actions, of which approximately $12 million will be cash. These charges are expected to consist of approximately $8 million of severance and $10 million of other costs, primarily asset write-offs. We also expect to incur approximately $3 million of project-related costs. We recognized $7.9 million of severance and $4.7 million of other costs in the second quarter of fiscal 2022. We expect these actions to be completed by the end of fiscal 2024.

We recorded a $9.9 million net recovery of restructuring charges in the second quarter of fiscal 2022 and a $14.0 million net recovery of restructuring charges in the six-month period ended November 28, 2021, related to restructuring actions previously announced. We recorded $0.9 million of restructuring charges in the second quarter of fiscal 2021 and $1.9 million of restructuring charges in the six-month period ended November 29, 2020, related to restructuring actions previously announced. The charges associated with restructuring actions previously announced primarily related to actions designed to better align our organizational structure and resources with strategic initiatives. We expect these actions to be completed by the end of fiscal 2023. Certain actions are subject to union negotiations and works counsel consultations, where required.

We paid net $42.8 million of cash in the six-month period ended November 28, 2021, related to restructuring actions previously announced. We paid net $5.5 million of cash in the same period of fiscal 2021.

Restructuring charges are recorded in our Consolidated Statements of Earnings as follows:

	Quarter Ended				Six-Month Period Ended
In Millions	Nov. 28, 2021		Nov. 29, 2020		Nov. 28, 2021		Nov. 29, 2020
Restructuring, impairment, and other exit costs (recoveries)	$	2.3	$	0.4	$	(2.0)	$	0.9
Cost of sales		0.4		0.5		0.6		1.0
Total restructuring charges (recoveries)	$	2.7	$	0.9	$	(1.4)	$	1.9

The roll forward of our restructuring and other exit cost reserves, included in other current liabilities, is as follows:

In Millions	Total
Reserve balance as of May 30, 2021	$	148.8
Fiscal 2022 net recoveries, including foreign currency translation		(2.0)
Utilized in fiscal 2022		(37.1)
Reserve balance as of Nov. 28, 2021	$	109.7

The reserve balance primarily consists of expected severance payments associated with restructuring actions.

The charges recognized in the roll forward of our reserves for restructuring and other exit costs do not include items charged directly to expense (e.g., asset impairment charges, accelerated depreciation, the gain or loss on the sale of restructured assets, and the write-off of spare parts) and other periodic exit costs are recognized as incurred, as those items are not reflected in our restructuring and other exit cost reserves on our Consolidated Balance Sheets.