Restructuring Plan

3 Months Ended

Sep. 30, 2024

Restructuring and Related Activities [Abstract]

Restructuring Plan

Restructuring Plan

Restructuring Plan

On May 23, 2023, the Board of Directors approved the Company’s May 2023 Restructuring Plan which includes site consolidations, facilities moves and closures, as well as the relocation and requalification of certain manufacturing facilities. These restructuring actions are expected to be accompanied by other cost reductions, and are intended to realign our cost structure as part of a transformation to a simpler, more streamlined, resilient and sustainable business model. We evaluate restructuring charges in accordance with ASC 420, Exit or Disposal Cost Obligations (ASC 420), and ASC 712, Compensation-Nonretirement Post-Employment Benefits (ASC 712).

In the three months ended September 30, 2024, these activities resulted in $24 million of charges primarily for impairment losses associated with the sale of our Newton Aycliffe business, accelerated depreciation, and site move costs. In the three months ended September 30, 2023, these activities resulted in $3 million of charges primarily for employee termination costs as well as site move costs, write-off of property and equipment and acceleration of depreciation. We expect the restructuring actions to be substantially completed by the end of fiscal 2025. However, the actual timing and costs associated with these restructuring actions may differ from our current expectations and estimates and such differences may be material.

Activity and accrual balances for the Restructuring Plan were as follows for the three months ended September 30, 2024 and September 30, 2023 ($000):

	Severance		Asset Write-Offs		Other		Total Accrual
Balance - June 30, 2024	$	51,061	$	—	$	—	$	51,061
Restructuring charges (recoveries)	(455)		15,970		8,850		24,365
Payments	(6,796)		—		—		(6,796)
Asset write-offs and other	—		(15,970)		(8,850)		(24,820)
Balance - September 30, 2024	$	43,810	$	—	$	—	$	43,810

	Severance		Asset Write-Offs		Other		Total Accrual
Balance - June 30, 2023	$	64,379	$	—	$	—	$	64,379
Restructuring charges	2,050		269		699		3,018
Payments	(7,930)		—		—		(7,930)
Asset write-offs and other	—		(269)		(699)		(968)
Balance - September 30, 2023	$	58,499	$	—	$	—	$	58,499

At September 30, 2024, $14 million and $30 million of accrued severance related costs were included in other accrued liabilities and other liabilities, respectively, and are expected to result in cash expenditures through fiscal 2028. The current year severance related recoveries are primarily comprised of adjustments to accruals for severance pay for employees being terminated due to the consolidation of certain manufacturing sites, with severance recorded in accordance with ASC 712. The prior year severance related costs are primarily comprised of severance pay for employees being terminated due to the consolidation of certain manufacturing sites, with severance recorded in accordance with ASC 712.

By segment, for the three months ended September 30, 2024, $24 million of restructuring costs were incurred in the Materials segment, and an immaterial amount of restructuring costs were incurred in the Lasers and Networking segments. By segment, for the three months ended September 30, 2023, $5 million of restructuring costs were incurred in the Materials segment, partially offset by $2 million of restructuring recoveries in the Networking segment. Restructuring charges and recoveries are recorded in Restructuring Charges in our Condensed Consolidated Statements of Earnings (Loss).