Restructuring Charges and Other Exit-Related Costs

In the fourth quarter of fiscal 2012, the Company undertook a number of restructuring initiatives designed to extract greater synergies from the significant acquisitions and technology investments made in recent years, achieve further integration between MRB and APB, and realign the Company’s organization to support its future growth and decrease operating expenses by streamlining functions and reducing organizational layers (the “Q4'12 Plan”).

In the first quarter of fiscal 2014, the Company announced and began implementing additional restructuring initiatives to further reduce its annual operating expenses through headcount reductions, productivity improvements, procurement savings and other operational efficiencies (the “Q1'14 Plan”).

In the first quarter of fiscal 2015, the Company announced and began implementing additional productivity initiatives at APB to improve profitability through a combination of revenue drivers and cost reduction initiatives (the “Q1'15 Plan”).

At the end of the second quarter of fiscal 2015, the Company initiated additional restructuring and exit-related initiatives by undertaking strategic actions consisting of idling underutilized assets at MRB and initiating the closure of seven APB stores to more closely align the Company's business to the prevalent market conditions. The Company expanded these initiatives in April 2015 by announcing measures aimed at further reducing the Company's annual operating expenses, primarily selling, general and administrative expenses, at Corporate, MRB and APB through headcount reductions, reducing organizational layers, consolidating shared service functions and other non-headcount measures. Collectively, these initiatives are referred to as the "Q2'15 Plan."

The vast majority of the restructuring charges require the Company to make cash payments.

In addition to the restructuring charges recorded related to these initiatives, the Company incurred other exit-related costs consisting of asset impairments and accelerated depreciation due to shortened useful lives in connection with site closures.

Restructuring charges and other exit-related costs were comprised of the following (in thousands):



	Three Months Ended February 28, 2015									Three Months Ended February 28, 2014
	Q1’14 Plan			Q1’15 Plan		Q2’15 Plan		Total Charges		Q4’12 Plan			Q1’14 Plan			Total Charges
Restructuring charges:
Severance costs	$	(57	)	$	428	$	540	$	911	$	(39	)	$	1,182		$	1,143
Contract termination costs	56			—		79		135		106			(9		)	97
Other restructuring costs	—			880		93		973		—			200			200
Total restructuring charges	(1		)	1,308		712		2,019		67			1,373			1,440
Other exit-related costs:
Asset impairments and accelerated depreciation	—			—		6,352		6,352		—			566			566
Total other exit-related costs	—			—		6,352		6,352		—			566			566
Total restructuring charges and other exit-related costs	$	(1	)	$	1,308	$	7,064	$	8,371	$	67		$	1,939		$	2,006



	Six Months Ended February 28, 2015									Six Months Ended February 28, 2014
	Q1’14 Plan			Q1’15 Plan		Q2’15 Plan		Total Charges		Q4’12 Plan			Q1’14 Plan		Total Charges
Restructuring charges:
Severance costs	$	(30	)	$	428	$	540	$	938	$	(13	)	$	2,259	$	2,246
Contract termination costs	309			—		79		388		568			29		597
Other restructuring costs	—			1,223		93		1,316		—			410		410
Total restructuring charges	279			1,651		712		2,642		555			2,698		3,253
Other exit-related costs:
Asset impairments and accelerated depreciation	—			—		6,352		6,352		—			566		566
Total other exit-related costs	—			—		6,352		6,352		—			566		566
Total restructuring charges and other exit-related costs	$	279		$	1,651	$	7,064	$	8,994	$	555		$	3,264	$	3,819



	Total Charges
	Q4'12 Plan		Q1’14 Plan		Q1'15 Plan		Q2'15 Plan		Total
Total restructuring charges to date	$	13,549	$	6,049	$	1,651	$	712	$	21,961
Total expected restructuring charges	$	13,549	$	6,100	$	1,651	$	9,900	$	31,200

The following illustrates the reconciliation of the restructuring liability by major type of costs for the six months ended February 28, 2015 (in thousands):



	All Other Plans									Q2’15 Plan									All Plans
	Balance 8/31/2014		Charges		Payments and Other			Balance 2/28/2015		Balance 8/31/2014		Charges		Payments and Other			Balance 2/28/2015		Total Charges to Date		Total Expected Charges
Severance costs	$	669	$	398	$	(1,033	)	$	34	$	—	$	540	$	(31	)	$	509	$	10,729	$	15,800
Contract termination costs	1,489		309		(813		)	985		—		79		—			79		5,441		8,000
Other restructuring costs	—		1,223		(772		)	451		—		93		—			93		5,791		7,400
Total	$	2,158	$	1,930	$	(2,618	)	$	1,470	$	—	$	712	$	(31	)	$	681	$	21,961	$	31,200

Due to the immateriality of the activity and liability balances for each of the Q4'12 Plan, Q1'14 Plan and Q1'15 Plan, the reconciliation of the restructuring liability is provided in aggregate.

The amounts of restructuring charges and other exit-related costs relating to each segment were as follows (in thousands):



	Three Months Ended February 28,				Six Months Ended February 28,				Total Charges to Date		Total Expected Charges
	2015		2014		2015		2014		Total Charges to Date		Total Expected Charges
Restructuring charges:
Metals Recycling Business	$	322	$	860	$	577	$	2,152	$	9,256	$	11,300
Auto Parts Business	1,634		435		2,008		496		3,537		8,500
Unallocated (Corporate)	63		145		57		605		9,168		11,400
Total restructuring charges	2,019		1,440		2,642		3,253		21,961		31,200
Other exit-related costs:
Metals Recycling Business	3,235		566		3,235		566		3,801
Auto Parts Business	3,117		—		3,117		—		3,117
Total other exit-related costs	6,352		566		6,352		566		6,918
Total restructuring charges and other exit-related costs	$	8,371	$	2,006	$	8,994	$	3,819	$	28,879

The Company does not allocate restructuring charges and other exit-related costs to the segments’ operating results because management does not include this information in its measurement of the performance of the operating segments.