Restructuring and Related Charges

9 Months Ended

May. 31, 2015

Restructuring and Related Charges [Abstract]

Restructuring and Related Charges

14. Restructuring and Related Charges

a. 2014 Restructuring Plan

In conjunction with the restructuring plan that was approved by the Company’s Board of Directors in fiscal year 2014 (the “2014 Restructuring Plan”), the Company charged $(0.2) millionand $42.3 million of restructuring and related charges to the Condensed Consolidated Statement of Operations during the three months and nine months endedMay 31,2014, respectively. The 2014 Restructuring Plan was intended to address the termination of the Company’s business relationship with BlackBerry Limited. The restructuring and related charges during the nine months ended May 31,2014 include cash costs of $16.4 million related to employee severance and benefit costs, $1.7 million related to lease costs and $1.5 million of other related costs, as well as non-cash costs of $22.7 million related to asset write-off costs. These restructuring and related charges associated with the 2014 Restructuring Plan were assigned fully to the EMS reportable segment. The Company completed the restructuring activities under this plan during the fourth quarter of fiscal year 2014 and does not expect to incur any additional costs under the 2014 Restructuring Plan. See Note 6 – “Concentration of Risk and Segment Data” for further details on the change in reportable segments.

The table below sets forth the significant components and activity in the 2014 Restructuring Plan during the three months and nine months endedMay 31,2014 (in thousands):

2014 Restructuring Plan – Three Months Ended May 31, 2014
			Restructuring		Asset Write-off
	Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
	February 28, 2014		Charges		Non-Cash Activity		Payments		May 31, 2014
Employee severance and benefit costs	$	3,417	$	(23)	$	(51)	$	(2,621)	$	722
Lease costs		1,381		―		(116)		(1,265)		―
Asset write-off costs		―		(159)		159		―		―
Other related costs		1,336		14		27		(1,355)		22
Total	$	6,134	$	(168)	$	19	$	(5,241)	$	744

2014 Restructuring Plan – Nine Months Ended May 31, 2014
			Restructuring		Asset Write-off
	Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
	August 31, 2013		Charges		Non-Cash Activity		Payments		May 31, 2014
Employee severance and benefit costs	$	―	$	16,350	$	12	$	(15,640)	$	722
Lease costs		―		1,738		(116)		(1,622)		―
Asset write-off costs		―		22,725		(22,725)		―		―
Other related costs		―		1,507		―		(1,485)		22
Total	$	―	$	42,320	$	(22,829)	$	(18,747)	$	744

b. 2013 Restructuring Plan

In conjunction with the restructuring plan that was approved by the Company’s Board of Directors in fiscal year 2013 (the “2013 Restructuring Plan”), the Company charged $(0.8) million and $33.3 million of restructuring and related charges to the Condensed Consolidated Statement of Operations during the three months and nine months endedMay 31,2015, respectively, compared to $12.6 million and $23.3 million during the three months and nine months endedMay 31,2014, respectively. The 2013 Restructuring Plan is intended to better align the Company’s manufacturing capacity in certain geographies and to reduce the Company’s worldwide workforce in order to reduce operating expenses. These restructuring activities are intended to address current market conditions and customer requirements. The restructuring and related charges during the three months and nine months endedMay 31,2015 include cash costs of $(1.9) million and $23.3 million related to employee severance and benefit costs, respectively,$0 and $2.8 million related to lease costs, respectively, and $0.4 million and $1.5 million of other related costs, respectively, as well as non-cash costs of $0.7 million and $5.7 million related to asset write-off costs, respectively. The restructuring and related charges during the three months and nine months endedMay 31,2014include cash costs of $6.8 million and $14.5 million related to employee severance and benefit costs, respectively,$0 and $0.4 million related to lease costs, respectively, and $0.5 million and $1.1 million of other related costs, respectively, as well as non-cash costs of $5.3 million and $7.3 million related to asset write-off costs, respectively.

The Company currently expects to recognize approximately $179.0 million, excluding the restructuring and related charges previously incurred for the AMS discontinued operations, in pre-tax restructuring and other related costs over the course of the Company’s fiscal years 2013, 2014, 2015 and 2016 under the 2013 Restructuring Plan. Since the inception of the 2013 Restructuring Plan, a total of $149.2 million of restructuring and related costs have been recognized. Of the $149.2 million recognized to date, $112.2 million was allocated to the EMS segment, $28.1 million was allocated to the DMS segment and $8.9 million was not allocated to a segment. A majority of the total restructuring costs are related to employee severance and benefit arrangements. The charges related to the 2013 Restructuring Plan, excluding asset write-off costs, are currently expected to result in cash expenditures of approximately $157.4 million that are payable over the course of the Company’s fiscal years 2013, 2014, 2015, 2016 and 2017. Much of the 2013 Restructuring Plan as discussed reflects the Company’s intention only and restructuring decisions, and the timing of such decisions, at certain plants are still subject to the finalization of timetables for the transition of functions and consultation with the Company’s employees and their representatives.

The tables below set forth the significant components and activity in the 2013 Restructuring Plan during the three months and nine months endedMay 31,2015 and 2014 (in thousands):

2013 Restructuring Plan – Three Months Ended May 31, 2015
			Restructuring		Asset Write-off
	Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
	February 28, 2015		Charges		Non-Cash Activity		Payments		May 31, 2015
Employee severance and benefit costs	$	36,156	$	(1,847)	$	(803)	$	(2,586)	$	30,920
Lease costs		2,403		―		―		(53)		2,350
Asset write-off costs		―		701		(701)		―		―
Other related costs		906		364		(30)		(480)		760
Total	$	39,465	$	(782)	$	(1,534)	$	(3,119)	$	34,030

2013 Restructuring Plan – Nine Months Ended May 31, 2015
			Restructuring		Asset Write-off
	Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
	August 31, 2014		Charges		Non-Cash Activity		Payments		May 31, 2015
Employee severance and benefit costs	$	45,246	$	23,355	$	(4,714)	$	(32,967)	$	30,920
Lease costs		18		2,777		(26)		(419)		2,350
Asset write-off costs		―		5,688		(5,688)		―		―
Other related costs		257		1,507		(93)		(911)		760
Total	$	45,521	$	33,327	$	(10,521)	$	(34,297)	$	34,030

2013 Restructuring Plan – Three Months Ended May 31, 2014
			Restructuring		Asset Write-off
	Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
	February 28, 2014		Charges		Non-Cash Activity		Payments		May 31, 2014
Employee severance and benefit costs	$	53,597	$	6,844	$	(446)	$	(10,301)	$	49,694
Lease costs		362		―		―		(346)		16
Asset write-off costs		―		5,277		(5,277)		―		―
Other related costs		66		493		21		(215)		365
Total	$	54,025	$	12,614	$	(5,702)	$	(10,862)	$	50,075

2013 Restructuring Plan – Nine Months Ended May 31, 2014
			Restructuring		Asset Write-off
	Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
	August 31, 2013		Charges		Non-Cash Activity		Payments		May 31, 2014
Employee severance and benefit costs	$	55,188	$	14,529	$	1,484	$	(21,507)	$	49,694
Lease costs		251		387		―		(622)		16
Asset write-off costs		―		7,290		(7,290)		―		―
Other related costs		―		1,126		21		(782)		365
Total	$	55,439	$	23,332	$	(5,785)	$	(22,911)	$	50,075

The tables below set forth the significant components and activity in the 2013 Restructuring Plan by reportable segment during the three months and nine months endedMay 31,2015 and 2014 (in thousands):

2013 Restructuring Plan – Three Months Ended May 31, 2015
				Restructuring		Asset Write-off
		Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
		February 28, 2015		Charges		Non-Cash Activity		Payments		May 31, 2015
	EMS	$	35,358	$	(1,107)	$	(1,534)	$	(1,897)	$	30,820
	DMS		3,701		―		―		(910)		2,791
	Other		406		325		―		(312)		419
	Total	$	39,465	$	(782)	$	(1,534)	$	(3,119)	$	34,030

2013 Restructuring Plan – Nine Months Ended May 31, 2015
				Restructuring		Asset Write-off
		Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
		August 31, 2014		Charges		Non-Cash Activity		Payments		May 31, 2015
	EMS	$	35,504	$	30,743	$	(10,375)	$	(25,052)	$	30,820
	DMS		8,268		424		(146)		(5,755)		2,791
	Other		1,749		2,160		―		(3,490)		419
	Total	$	45,521	$	33,327	$	(10,521)	$	(34,297)	$	34,030

2013 Restructuring Plan – Three Months Ended May 31, 2014
				Restructuring		Asset Write-off
		Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
		February 28, 2014		Charges		Non-Cash Activity		Payments		May 31, 2014
	EMS	$	40,598	$	10,212	$	(4,060)	$	(5,465)	$	41,285
	DMS		13,249		1,845		(1,642)		(4,662)		8,790
	Other		178		557		―		(735)		―
	Total	$	54,025	$	12,614	$	(5,702)	$	(10,862)	$	50,075

2013 Restructuring Plan – Nine Months Ended May 31, 2014
				Restructuring		Asset Write-off
		Liability Balance at		Related		Charge and Other		Cash		Liability Balance at
		August 31, 2013		Charges		Non-Cash Activity		Payments		May 31, 2014
	EMS	$	45,999	$	8,796	$	(2,425)	$	(11,085)	$	41,285
	DMS		9,407		12,275		(3,360)		(9,532)		8,790
	Other		33		2,261		―		(2,294)		―
	Total	$	55,439	$	23,332	$	(5,785)	$	(22,911)	$	50,075