Note 14 - Restructuring Costs

6 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Restructuring and Related Activities Disclosure [Text Block]

NOTE

1

4

– RESTRUCTURING COSTS

On

September 22, 2016,

the Company announced plans to close its

lighting facility in Kansas City, Kansas. The decision was based upon the market shift away from fluorescent and other technologies and the rapid movement to LED lighting which is produced at other LSI facilities. The Company expects to continue to meet the demand for products containing fluorescent light sources as long as these products are commercially viable. All operations at the Kansas City facility ceased prior to

December 31, 2016.

Fiscal

2017

restructuring costs related to the closure of the Kansas City facility were

$944,000.

There have been

no

restructuring costs in fiscal

2018.

These costs primarily included employee-related costs (primarily severance), the impairment of manufacturing equipment, plant shut down costs, costs related to the preparation of the facility for sale, legal costs, and other related costs. In addition, there was also an inventory write-down of

$485,000

recorded in fiscal

2017.

The write-down was related to inventory that was previously realizable until the decision in the

first

quarter of fiscal

2017

to close the Kanas City plant due to the planned curtailment of the manufacturing of fluorescent light fixtures. The Company owned the facility in Kansas City and realized a

$1,361,000

gain when the facility was sold.

T

he Company also announced the consolidation of the Beaverton, Oregon facility into other LSI facilities. The light assembly of products in the Beaverton facility was moved to the Company’s Columbus, Ohio facility, and administration and engineering functions were moved to the Company’s Cincinnati, Ohio facility. This consolidation was completed

September 30, 2016.

As a result of this consolidation, restructuring charges of

$377,000

were recorded in fiscal

2017,

with the majority of this representing the costs related to the remaining period of the facility’s lease and severance costs for employees who formerly worked in the Beaverton facility. There were

no

restructuring charges in fiscal

2018.

   

In

November 2016,

the Company announced the consolidation

of the Woonsocket, Rhode Island manufacturing operation into its North Canton, Ohio operation. The manufacturing operations in Woonsocket ceased prior to

December 31, 2016.

The Company owned the facility in Woonsocket and realized a small gain when the facility was sold in

September 2017.

Total restructuring costs related to the consolidation of the Woonsocket facility were

$452,000

in fiscal

2017.

These costs primarily include employee-related costs (severance), plant shut down costs, costs related to the preparation of the facility for sale, legal costs, and other related costs. There have been

no

restructuring charges in fiscal

2018.

Management does

not

expect any significant restructuring charges for fiscal

2018.

All previously announced

restructuring projects were completed in fiscal

2017

and all restructuring charges were recorded in fiscal

2017.

The following table presents information about restructuring

costs for the periods indicated:

	Three		Six Months		Three		Six Months
	Months Ended		Ended		Months Ended		Ended
(In thousands)	December 31,		December 31,		December 31,		December 31,
	2017		2017		2016		2016
Severance and other termination benefits	$	--	$	--	$	526	$	691
Lease obligation		--		--		--		213
Impairment of fixed assets and accelerated depreciation		--		--		80		353
Other		--		--		91		96
Total	$	--	$	--	$	697	$	1,353

The following table presents restructuring costs incurred by line item in the consolidated statement of operations in which the costs are included:

	Three Months Ended		Six Months Ended
(In thousands)	December 31		December 31
	2016		2016
Cost of Goods Sold	$	640	$	1,143
Operating Expenses		57		210
Total	$	697	$	1,353

The following

table presents information about restructuring costs by segment for the periods indicated:

	Three		Six Months		Three		Six Months
	Months Ended		Ended		Months Ended		Ended
(In thousands)	December 31,		December 31,		December 31,		December 31,
	2017		2017		2016		2016
Lighting Segment	$	--	$	--	$	476	$	1,021
Graphics Segment		--		--		221		221
Corporate and Eliminations		--		--		--		111
Total	$	--	$	--	$	697	$	1,353

The above tables exclude the gain on the sale of the Kansas City and Woonsocket facilities. Additionally, the

above tables do

not

include expense of

$400,000

recorded during the

first

quarter of fiscal

2017

related to the write-down of inventory included as cost of sales as part of the Kansas City facility closure.

The following table presents a roll forward of the beg

inning and ending liability balances related to the restructuring costs:

(In thousands)
	Balance as of June 30, 2017		Restructuring Expense		Payments			Adjustments		Balance as of December 31, 2017
Severance and termination benefits	$	--	$	--	$	--		$	--	$	--
Lease obligation		85		--		(85	)		--		--
Other		--		--		--			--		--
Total	$	85	$	--	$	(85	)	$	--	$	--

Refer to Note

13

for information regarding additional severance expenses that are

not

included in the restructuring costs identified in this footnote.