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RESTRUCTURING, ACQUISITION, AND INTEGRATION RELATED EXPENSES (Notes)
12 Months Ended
Aug. 03, 2019
Restructuring and Related Activities [Abstract]  
RESTRUCTURING, ACQUISITION AND INTEGRATION RELATED EXPENSES
NOTE 5—RESTRUCTURING, ACQUISITION AND INTEGRATION RELATED EXPENSES
Restructuring, acquisition and integration related expenses were as follows:
(in thousands)
 
2019
 
2018
 
2017
2019 SUPERVALU INC. restructuring expenses
 
$
74,414

 
$

 
$

Acquisition and integration costs
 
56,589

 
4,967

 

Closed property charges
 
22,536

 

 

2018 Earth Origins Market restructuring expenses and loss on sale
 

 
4,771

 

2017 Cost Saving and Efficiency Initiatives
 

 

 
6,864

Total
 
$
153,539

 
$
9,738

 
$
6,864



Closed Property Reserves

Changes in reserves for closed properties, including additions noted above, consisted of the following:
(in thousands)
 
2019
 
2018
 
2017
Beginning balance
 
$

 
$

 
$
443

    Acquired liabilities
 
34,581

 

 

    Additions, accretion and changes in estimates, net
 
16,529

 
1,400

 
258

    Payments
 
(22,467
)
 
(1,400
)
 
(701
)
Ending balance
 
$
28,643

 
$

 
$



Reserves for closed property are included in the Consolidated Balance Sheets within Accrued expenses and other current liabilities and Other long-term liabilities. Closed property charges recorded in fiscal 2019 primarily relate to 17 retail stores, including certain Shop ‘n Save and Shop ‘n Save East branded stores, and are net of estimated sublease assumptions. In addition, 12 property leases including non-retail properties with reserves were terminated in fiscal 2019.

Restructuring Programs

The following is a summary of the restructuring reserves by reserve type included in the Consolidated Balance Sheets, primarily within Accrued compensation and benefits for severance and other employee separation costs and tax payments, within Accrued expenses and other current liabilities for the current portion of closed property reserves and within Other long-term liabilities for the long-term portion of closed property reserves.
(in thousands)
 
2019 SUPERVALU INC.
 
2018 Earth Origins Market
 
2017 Cost Saving and Efficiency Initiatives
 
Total
Balances at July 29, 2017
 
$

 
$

 
$
4,298

 
$
4,298

    Restructuring program charge
 

 
2,219

 

 
2,219

    Cash payments
 

 
(1,836
)
 
(3,597
)
 
(5,433
)
Balances at July 28, 2018
 

 
383

 
701

 
1,084

    Restructuring program charge(1)
 
74,414

 

 

 
74,414

    Acquired restructuring liability
 
12,573

 

 

 
12,573

    Cash payments
 
(75,130
)
 

 

 
(75,130
)
Balances at August 3, 2019
 
$
11,857

 
$
383

 
$
701

 
$
12,941

 
 
 
 
 
 
 
 
 
Cumulative program charges incurred from inception to date
 
$
74,414

 
$
2,219

 
$
6,864

 
$
83,497

(1)
Includes $43.0 million of charges related to change-in-control expense to satisfy outstanding equity awards and severance related costs.

2019 SUPERVALU INC.

As part of its acquisition of Supervalu and in order to achieve synergies from this combination, the Company is taking certain actions, which began during the first quarter of fiscal 2019 and will continue through at least fiscal 2020 to: (i) review its organizational structure and the strategic needs of the business going forward to identify and place talent with the appropriate skills, experience and qualifications to meet these needs; and (ii) dispose of and exit the Supervalu legacy retail operations, as efficiently and economically as possible in order to focus on the Company’s core wholesale distribution business. Actions associated with retail divestitures and adjustments to the Company’s core cost-structure for its wholesale food distribution business are expected to result in headcount reductions and other costs and charges.

2018 Earth Origins Market

During the second quarter of fiscal 2018 the Company made the decision to close three non-core, under-performing stores of its total twelve stores related to its Earth Origins Market Retail business. Based on this decision, the Company recorded restructuring costs of $9.7 million during fiscal 2018. In the fourth quarter of fiscal 2018, the Earth Origins Retail business was sold and the Company recorded a loss on disposition of assets of $2.7 million.

2017 Cost Saving and Efficiency Initiatives

During fiscal 2017, the Company announced a restructuring program in conjunction with various cost saving and efficiency initiatives, including the planned opening of a shared services center.