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Restructuring
6 Months Ended
Mar. 31, 2024
Restructuring and Related Activities [Abstract]  
Restructuring

12. Restructuring

Restructuring expenses, included in Cost of Goods Sold (“COGS”) and Restructuring for the three and six months ended March 31, 2024 and 2023, are as follows (in thousands):

 

 

Three Months Ended
March 31,

 

 

Six Months Ended
March 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Included in COGS (a)

 

 

 

 

 

 

 

 

 

 

 

 

Distribution Center Consolidation and Store Optimization Plan

 

$

 

 

$

(2,362

)

 

$

 

 

$

(5,042

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Included in Restructuring (b)

 

 

 

 

 

 

 

 

 

 

 

 

Distribution Center Consolidation and Store Optimization Plan

 

$

63

 

 

$

7,274

 

 

$

(22

)

 

$

17,680

 

(a)
Amounts included in COGS relate to adjustments to our expected obsolescence reserve related to the Plan (as defined below).
(b)
For the three and six months ended March 31, 2023, restructuring consisted of closing costs related to lease terminations and employee termination benefits. The six months ended March 31, 2023, also includes $2.1 million in impairment charges.

Distribution Center Consolidation and Store Optimization Plan

In the fourth quarter of fiscal year 2022, our Board approved the Distribution Center Consolidation and Store Optimization Plan (“the Plan”) authorizing the closure of 330 SBS stores and 35 BSG stores, and the closure of two BSG distribution centers in Clackamas, Oregon and Pottsville, Pennsylvania. Stores identified for early closure were part of a strategic evaluation which included a market analysis of certain locations where we believed we would be able to recapture demand and improve profitability.

The Plan has been substantially completed, as the remaining two BSG stores were closed earlier this fiscal year. However, we may still incur future immaterial charges related to store closures such as exit costs, lease negotiation penalties and adjustments to estimates. As of March 31, 2024, there were no material outstanding liabilities for exit costs or involuntary employee termination benefits.