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RESTRUCTURING CHARGES
12 Months Ended
Feb. 29, 2020
Restructuring And Related Activities [Abstract]  
RESTRUCTURING CHARGES

NOTE 11 – RESTRUCTURING CHARGES

 

In fiscal 2019, we commenced a plan (the “Plan”) to capture certain synergies and cost savings related to streamlining our global operations and sales organization, as well as rationalize certain leased properties that are not fully occupied. Our Plan is aligned with our strategy to integrate the global sales organization and further outsource manufacturing functions in order to drive operational efficiency, increase supplier geographic diversity, and reduce operating expenses. To date, total restructuring charges were $12.4 million, comprised primarily of $6.8 million in severance and employee related costs, $5.6 million for vacant office and manufacturing facility. Restructuring charges related to vacant office and manufacturing facility space were due primarily to the vacancy in Canton, Massachusetts of $3.3 million. Substantially all charges related to severance and employee costs were under the Telematics Systems reportable segment. As a result of the adoption of ASC 842, effective March 1, 2019, the balance of the restructuring liability related to certain facility leases have been reclassified as a reduction of the Operating lease right-of-use assets in our consolidated balance sheet.

 

For fiscal year ended February 29, 2020, total restructuring charges were $4.4 million, comprised of $2.5 million in severance and employee related costs and $1.9 million for manufacturing facility. Substantially all charges were recorded under the Telematics Systems reportable segment. The impairment of $1.2 million for the vacant office space was recorded as a reduction of Operating lease right-of-use assets in our consolidated balance sheet as of February 29, 2020. The restructuring liabilities related to personnel were included in Accrued payroll and employee benefits in our consolidated balance sheets as of February 29, 2020 and February 28, 2019.

 

The following table summarizes the charges resulting from the implementation of the restructuring plan for the fiscal years ended February 29, 2020 and February 28, 2019 (in thousands):

 

 

Years ended February 29/28,

 

 

2020

 

 

2019

 

 

Personnel

 

 

Facilities

 

 

Total

 

 

Personnel

 

 

Facilities

 

 

Total

 

Cost of revenue

$

493

 

 

$

1,853

 

 

$

2,346

 

 

$

1,585

 

 

$

1,001

 

 

$

2,586

 

Research and development

 

222

 

 

 

-

 

 

 

222

 

 

 

412

 

 

 

803

 

 

 

1,215

 

Selling and marketing

 

601

 

 

 

-

 

 

 

601

 

 

 

1,228

 

 

 

1,388

 

 

 

2,616

 

General and administrative

 

1,231

 

 

 

-

 

 

 

1,231

 

 

 

1,050

 

 

 

548

 

 

 

1,598

 

Total

$

2,547

 

 

$

1,853

 

 

$

4,400

 

 

$

4,275

 

 

$

3,740

 

 

$

8,015

 

 

The following table summarizes the activity resulting from the implementation of the restructuring plan within other current and non-current liabilities (in thousands):

 

 

 

Personnel

 

 

Facilities

 

 

Total

 

Restructuring liabilities as of February 28, 2018

 

$

 

 

$

 

 

$

 

Charges

 

 

4,275

 

 

 

3,740

 

 

 

8,015

 

Payments

 

 

(1,496

)

 

 

(763

)

 

 

(2,259

)

Restructuring liabilities as of February 28, 2019

 

$

2,779

 

 

$

2,977

 

 

$

5,756

 

Cease-use liability reclassified as reduction of Operating lease right-of-use assets

 

 

-

 

 

 

(2,977

)

 

 

(2,977

)

Charges

 

 

2,547

 

 

 

644

 

 

 

3,191

 

Payments

 

 

(2,943

)

 

 

(285

)

 

 

(3,228

)

Restructuring liabilities as of February 29, 2020

 

$

2,383

 

 

$

359

 

 

$

2,742

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The anticipated rent payments for the ceased-use leased facilities will be made through December 2025.