Business realignment and acquisition integration charges

3 Months Ended

Sep. 30, 2019

Restructuring and Related Activities [Abstract]

Business realignment and acquisition integration charges

We incurred business realignment and acquisition integration charges in fiscal 2020 and 2019. The business realignment charges primarily consist of severance costs related to actions taken under the Company's simplification initiative aimed at reducing organizational and process complexity as well as plant closures. The prior-year acquisition integration charges relate to the fiscal 2017 acquisition of CLARCOR, Inc. ("Clarcor") and primarily consist of severance costs and expenses related to plant closures and relocations.

A majority of the business realignment charges were incurred in North America during the current-year quarter, while a significant portion of the expense was incurred both in North America and Europe during the prior-year quarter. We believe the realignment actions will positively impact future results of operations but will not have a material effect on liquidity and sources and uses of capital.

Business realignment and Clarcor acquisition integration charges presented in the Business Segment Information are as follows:



	Three Months Ended
	September 30,
	2019			2018
Diversified Industrial	$	4,725		$	8,558
Aerospace Systems	(7		)	—
Corporate general and administrative expenses	5			—
Other expense	—			55

Workforce reductions in connection with business realignment and Clarcor acquisition integration charges in the Business Segment Information are as follows:



	Three Months Ended
	September 30,
	2019	2018
Diversified Industrial	219	201
Corporate general and administrative expenses	1	—

The business realignment and Clarcor acquisition integration charges are presented in the Consolidated Statement of Income as follows:



	Three Months Ended
	September 30,
	2019		2018
Cost of sales	$	3,345	$	4,399
Selling, general and administrative expenses	1,378		4,159
Other (income), net	—		55

During the current-year quarter, approximately $5 million in payments were made relating to business realignment and Clarcor acquisition integration charges. Remaining payments related to current-year and prior-year business realignment and acquisition integration actions of approximately $11 million are primarily reflected within the other accrued liabilities caption in the Consolidated Balance Sheet, a majority of which are expected to be paid by September 30, 2020. Additional charges may be recognized in future periods related to the business realignment described above, the timing and amount of which are not known at this time.

During the current-year quarter, we also incurred acquisition integration charges of $4,009 related to Exotic and the subsequent acquisition of Lord, of which $3,414 and $595 are included in the Diversified Industrial and Aerospace Systems Segments, respectively. These charges are primarily included in selling, general and administrative expenses within the Consolidated Statement of Income.