Restructuring

6 Months Ended

Dec. 31, 2020

Restructuring and Related Activities [Abstract]

Restructuring

Restructuring

In June 2020, the Company recorded a $1.6 million restructuring charge of which $1.0 million remained in the accrual at fiscal 2020 year end. The total planned expenditure is $4.0 million, $1.2 million in the U.S. and $2.8 million internationally, expensed during the five quarters from Q42020 to Q42021. $2.3 million has been charged as restructuring in the nine months ending December 31, 2020. The Company adopted this plan in order to consolidate certain saw manufacturing operations for greater efficiency. This restructuring is strategically targeting improving manufacturing utilization globally and will be completed in fiscal 2021.

The COVID-19 pandemic created a negative impact on global sales. The impact was felt as early as January 2020 in the Company’s operation in Suzhou, China and most significantly in March 2020 in North America and in the UK. The Company took austerity measures, reducing payroll and managing variable operational spending to help mitigate the shortfall. In addition, the Company is investing in a strategic realignment focused on a lower cost structure, long term, designed to maximize our global factory utilization. Total restructuring cost of $4.0 million is expected to drive annual savings of $10-14 million annually beginning in fiscal year 2021 as planned implementation throughout the year, with full annual savings realized in fiscal year 2022. These savings will be reflected in the Consolidated Statements of Operations in a reduction to cost of goods sold and selling, general and administrative expenses.

In the six months ended December 31, 2020, $0.7 million of restructuring cost were charged as a period expense in the Consolidated Statements of Operations, on a separate line, and $1.0 million was charged against accrued expenses on the Consolidate Balance Sheets. The remaining balance of the accrual at December 31, 2020 is zero. The Company expects to charge an addition $1.7 million in the period those cost are incurred in the remaining six months of fiscal year 2021. There currently have been no material losses related to disposal of assets. The Company recorded a gain on the sale of fixed assets internationally of $0.2 million