Restructuring Charges (Notes)

3 Months Ended

Nov. 30, 2024

Restructuring and Related Activities [Abstract]

Restructuring and Related Activities Disclosure [Text Block]

Note 4. Restructuring Charges

The Company has undertaken or committed to various restructuring initiatives, including workforce reductions, leadership changes, plant consolidations to reduce manufacturing overhead, satellite office closures, the continued movement of production and product sourcing to low-cost alternatives, and the centralization and standardization of certain administrative functions. Liabilities for severance are generally to be paid within twelve months, while future lease payments related to facilities vacated as a result of restructuring are to be paid over the underlying remaining lease terms.

On June 27, 2022, the Company approved a restructuring plan in connection with the initiatives identified as part of the ASCEND transformation program (see Note 3, “ASCEND Transformation Program”) to drive greater efficiency and productivity in global selling, general and administrative resources. The total costs of this plan were then estimated at $6 to $10 million, constituting predominately severance and other employee-related costs to be incurred as cash expenditures and impacting both IT&S and Corporate.

In September 2022, the Company approved an update to the restructuring plan to a range of $10 to $15 million; these costs were still incorporated into the initial investment value and the range did not change at that time.

The Company recorded $2.4 million of restructuring charges associated with the ASCEND transformation program in the three months ended November 30, 2023. No restructuring charges associated with the ASCEND transformation program were recorded in the three months ended November 30, 2024 as the ASCEND program ended at August 31, 2024.

The following summarizes restructuring reserve activity (which for the three months ended November 30, 2023 excludes $0.2 million of charges associated with the accelerated vesting of equity awards within the ASCEND transformation plan, which has no impact on the restructuring reserve) for the IT&S segment and Corporate (in thousands):

	Three Months Ended November 30, 2024
	IT&S		Corporate
Balance as of August 31, 2024	$	3,527	$	197
Cash payments	(810)		(9)
Impact of changes in foreign currency rates	(36)		—
Balance as of November 30, 2024	$	2,681	$	188

	Three Months Ended November 30, 2023
	IT&S		Corporate
Balance as of August 31, 2023	$	2,238	$	74
Restructuring charges	2,062		174
Cash payments	(1,312)		(75)
Balance as of November 30, 2023	$	2,988	$	173

Total restructuring charges (inclusive of the Other operating segment) were $2.4 million in the three months ended November 30, 2023, being reported, in "Restructuring charges." There were no restructuring charges in the three months ended November 30, 2024.

ASCEND Transformation Program

Note 3. ASCEND Transformation Program

In March 2022, the Company announced the start of its ASCEND transformation program, initially estimating an incremental $40 to $50 million of annual operating profit once fully implemented. ASCEND's key initiatives included accelerating organic growth strategies, improving operational excellence and production efficiency by utilizing a Lean approach, and driving greater efficiency and productivity in selling, general and administrative ("SG&A") expense by better leveraging resources to create a more efficient and agile organization.

At that time, the Company anticipated investing $60 to $65 million through the end of fiscal 2024 to complete these actions.

In June 2022, the Company approved a restructuring plan in connection with the initiatives identified as part of the ASCEND transformation program to drive greater efficiency and productivity in global SG&A resources. The total costs of this plan were then estimated at $6 to $10 million, constituting predominately severance and other employee-related costs to be incurred as cash expenditures and impacting both IT&S and Corporate (see Note 4, "Restructuring Charges,"). These costs were incorporated into the initial investment of $60 to $65 million.

In September 2022, the Company approved an update to the restructuring plan to a cost range of $10 to $15 million; these costs were still incorporated into the initial investment value and the range did not change at that time.

In March 2023, the investment range increased from the initial $60 to $65 million, to $70 to $75 million inclusive of the $10 to $15 million of the previously announced restructuring over the life of the program.

Total program expenses were approximately $3.6 million in the three months ended November 30, 2023, with no expenses in the three months ended November 30, 2024, as the ASCEND program ended at August 31, 2024. Of the total ASCEND program expenses for the three months ended November 30, 2023, $1.1 million were recorded within SG&A expenses and approximately $0.1 million were recorded within cost of goods sold. Additionally, for the three months ended November 30, 2023, $2.4 million of ASCEND expenses were recorded within restructuring expenses (see Note 4, “Restructuring Charges”).