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EMPLOYEE BENEFIT AND RETIREMENT PLANS
 12 Months Ended
Jun. 30, 2023
Retirement Benefits [Abstract]  
EMPLOYEE BENEFIT AND RETIREMENT PLANS EMPLOYEE BENEFIT AND RETIREMENT PLANS
The Company has two defined benefit pension plans, one for U.S. employees which includes the Non-qualified Excess Plan and another for U.K. employees, together referred to as the "Plans Combined". The Company has a postretirement medical benefit plan for U.S. employees with a total benefit in fiscal 2023 of $1.2 million and in fiscal 2022 of $1.2 million. The Company also has defined contribution plans with a total cost in fiscal 2023 of $1.6 million and in 2022 of $1.6 million. The total Plans Combined benefit was $8.7 million in fiscal 2023 and $0.2 million in fiscal 2022. The net periodic benefit for the U.S. Retirement Plan was a consistent benefit of $1.2 million in both fiscal years and the U.K. plan decreased $0.2 million during the year.
On December 21, 2016, the Company amended the U.S. defined benefit pension plan to freeze benefit accruals effective December 31, 2016. Consequently, the plan is closed to new participants and current participants no longer earn additional benefits after December 31, 2016. The U.K. plan was frozen to new participants in fiscal 2009.
The Company amended its Postretirement Medical Plan effective December 31, 2013 whereby the Company terminated eligibility for employees ages 55-64. For retirees 65 and older, the Company’s contribution is fixed at $28.50 or $23.00 per month depending upon the plan the retiree has chosen.

The U.S. Retirement Plan experienced asset and liability gains during the fiscal year. The increase in outstanding unrecognized gain exceed the 10% corridor triggering a market-to-market ("MTM") adjustment for Q4 of fiscal 2023 of approximately $10.5 million, partially offset by $1.7 million of interest on benefit obligations and plan assets, resulting in a total pension income, or net benefit, for fiscal 2023 of $8.8 million.
The underfunded status of the Plans Combined improved by $10.7 million during fiscal 2023 going from underfunded amount of $23.7 million at June 30, 2022 to an underfunded amount of $13.0 million at June 30, 2023. The benefit obligation decreased $11.8 million during fiscal 2023 as a result of $6.9 million in interest and foreign exchange cost, a decrease of $7.2 million of benefits paid and the actuarial gain of $11.5 million.
The most significant driver in the change in the U.S. benefit obligation and the Non-qualified Plan both experienced losses as a result of the change in the U.S. discount rate to 5.34% in fiscal 2023 versus 4.77% in fiscal 2022. In the U.K. the discount rate changed to 5.14% in fiscal 2023 versus 3.82% in fiscal 2022. The Postretirement Benefit Plan discount rate change from 4.77% to 5.34% combined with demographic gains due to participants retiring and opting to not elect medical coverage.
The Plans Combined change in fair value of total plan assets was a decrease during fiscal 2023 of $1.1 million from $110.6 million at June 30, 2022 to $109.5 million at June 30, 2023. The components attributing to the $1.1 million change were the actual return of plan assets which increased during fiscal 2023 $2.7 million, employer contributions were $2.4 million and exchange rate changes of $0.9 million offset by the benefits paid of $7.2 million.
In 2021, the Company amended the Postretirement Benefit Plan to eliminate Life Insurance coverage for current and future retirees. Under the Plans Combined, benefits are based on years of service and final average earnings. Plan assets consist primarily of investment grade debt obligations, marketable equity securities and shares of the Company’s common stock. The asset allocation of the Company’s domestic pension plan is diversified, consisting primarily of investments in equity and debt securities. The Company seeks a long-term investment return that is given reasonable prevailing capital market expectations. Target allocations are 40% to 70% in equities (including 10% to 20% in Company stock), and 30% to 60% in cash and debt securities.
In fiscal 2024, the Company will use an expected long-term rate of return on assets assumption of 3.56% for the U.S. domestic pension plan, and 5.74% for the U.K. plan. In determining these assumptions, the Company considers the historical returns and expectations for future returns for each asset class as well as the target asset allocation of the pension portfolio as a whole.
Other than the discount rate, pension valuation assumptions are generally long-term and not subject to short-term market fluctuations, although they may be adjusted as warranted by structural shifts in economic or demographic outlooks. Long-term assumptions are reviewed annually to ensure they do not produce results inconsistent with current market conditions. The discount rate is adjusted annually based on corporate investment grade (rated AA or better) bond yields, the maturities of which are correlated with the expected timing of future benefit payments, as of the measurement date.

The Company contributed $2.4 million in fiscal 2023, of which $1.5 million is in the U.S. and $0.9 million in the U.K. The Company expects to contribute $3.9 million in fiscal 2024 of which $3.0 million is in the U.S. and $0.9 in the U.K. As a result of the American Rescue Plan Act of 2021, the minimum required company contribution for the U.S. Plan may be lower than the actuarial valuation. The Company believes that government regulation combined with the actuarial estimates are two important factors and continues to evaluate its contribution into the plans on an ongoing basis.
The table below sets forth the actual asset allocation for the assets within the Company’s plans.
20232022
Asset category:
Cash equivalents1 %2 %
Fixed income38 %40 %
Equities40 %32 %
Mutual and pooled funds21 %26 %
100 %100 %
The Company determines its investments strategies based upon the composition of the beneficiaries in its defined benefit plans and the relative time horizons that those beneficiaries are projected to receive payouts from the plans. The Company engages an independent investment firm to manage the U.S. pension assets.
Cash equivalents are held in money market funds.
The Company’s fixed income portfolio includes mutual funds that hold a combination of short-term, investment-grade fixed income securities and a diversified selection of investment-grade, fixed income securities, including corporate securities and U.S. government securities.
The Company invests in equity securities, which are diversified across a spectrum of value and growth in large, medium and small capitalization funds and companies, as appropriate to achieve the objective of a balanced portfolio, optimize the expected returns and minimize volatility in the various asset classes.
Other assets include pooled investment funds whose underlying assets consist primarily of property holdings as well as financial instruments designed to offset the long-term impact of inflation and interest rate fluctuations.
The Company has categorized its financial assets (including its pension plan assets), based on the priority of the inputs to the valuation technique, into a three-level fair value hierarchy as set forth below. If the inputs used to measure the financial
instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.
Financial assets are categorized based on the inputs to the valuation techniques as follows:
◦Level 1 – Financial assets whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market which the Company has the ability to access at the measurement date.
◦Level 2 – Financial assets whose value are based on quoted market prices in markets where trading occurs infrequently or whose values are based on quoted prices of instruments with similar attributes in active markets.
◦Level 3 – Financial assets whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect management’s own view about the assumptions a market participant would use in pricing the asset.
The tables below show the portfolio by valuation category as of June 30, 2023 and June 30, 2022 (in thousands):
June 30, 2023
Asset CategoryLevel 1Level 2Level 3Total%
Cash Equivalents$1,326 $— $— $1,326 1 %
Fixed Income— 41,145 — 41,145 38 %
Equities42,810 1,338 — 44,148 40 %
Mutual & Pooled Funds— 22,892 — 22,892 21 %
Total$44,136 $65,375 $— $109,511 100 %
Included in equity securities at June 30, 2023 and 2022 are shares of the Company’s ESOP common stock having a fair value of $5.1 million and $3.8 million, respectively.

June 30, 2022
Asset CategoryLevel 1Level 2Level 3Total%
Cash Equivalents$2,620 $— $— $2,620 2 %
Fixed Income— 44,562 — 44,562 40 %
Equities33,869 965 — 34,834 32 %
Mutual & Pooled Funds— 28,598 — 28,598 26 %
Total$36,489 $74,125 $— $110,614 100 %
U.S. and U.K. Plans Combined: 
The status of these defined benefit plans is as follows (in thousands): 
20232022
Change in benefit obligation
Benefit obligation at beginning of year$134,303 $172,617 
Interest cost5,820 4,113 
Exchange rate changes1,075 (4,985)
Benefits paid(7,151)(6,941)
Actuarial (gain) loss(11,499)(30,501)
Benefit obligation at end of year$122,548 $134,303 
Change in plan assets
Fair value of plan assets at beginning of year110,614 135,192 
Actual return on plan assets2,701 (15,941)
Employer contributions2,449 2,517 
Benefits paid(7,151)(6,941)
Exchange rate changes907 (4,213)
Fair value of plan assets at end of year109,520 110,614 
Funded status at end of year$(13,028)$(23,689)
Amounts recognized in balance sheet
Current liability$(2,076)$(1,157)
Non-current liability(10,952)(22,532)
Net amount recognized in balance sheet$(13,028)$(23,689)
Amounts not yet reflected in net periodic benefit costs and included in accumulated other comprehensive loss
Accumulated loss$6,520 $6,883 
Amounts not yet recognized as a component of net periodic benefit cost6,520 6,883 
Accumulated net periodic benefit cost in excess of contributions(19,548)(30,572)
Net amount recognized$(13,028)$(23,689)
Components of net periodic benefit cost
Interest cost$5,820 $4,113 
Expected return on plan assets(4,023)(4,378)
Recognized actuarial loss(10,451)57 
Net periodic (benefit) cost$(8,654)$(208)
Estimated amounts that will be amortized from accumulated other comprehensive loss over the next year
Net loss$(40)$(57)
Information for pension plans with accumulated benefits in excess of plan assets
Projected benefit obligation$122,548 $134,303 
Accumulated benefit obligation$122,548 $134,303 
Fair value of assets$109,520 $110,614 
U.S. Plan:
The status of the U.S. defined benefit plan is as follows (in thousands):
20232022
Change in benefit obligation
Benefit obligation at beginning of year$100,580 $124,633 
Interest cost4,571 3,274 
Benefits paid(5,577)(5,191)
Actuarial loss(4,585)(22,136)
Benefit obligation at end of year$94,989 $100,580 
Weighted average assumptions – benefit obligation
Discount rate5.34 %4.77 %
Rate of compensation increasen/an/a
Change in plan assets
Fair value of plan assets at beginning of year$81,547 $95,848 
Actual return on plan assets8,641 (10,633)
Employer contributions1,543 1,523 
   Plan Settlement— — 
Benefits paid(5,577)(5,191)
Fair value of plan assets at end of year86,154 81,547 
Funded status at end of year$(8,835)$(19,033)
Amounts recognized in balance sheet
Current liability$(2,076)$(1,157)
Non current liability(6,759)(17,876)
Net amount recognized in balance sheet$(8,835)$(19,033)
Weighted average assumptions – net periodic benefit cost
Discount rate4.77 %2.69 %
Rate of compensation increaseVariesVaries
Return on plan assets3.56 %3.56 %
Amounts not yet reflected in net periodic benefit cost and included in accumulated other comprehensive loss
 Income (loss)$8,629 $8,650 
Amounts not yet recognized as a component of net periodic benefit cost8,629 8,650 
Accumulated contributions less than net periodic benefit cost(17,464)(27,683)
Net amount recognized$(8,835)$(19,033)
Components of net periodic benefit cost
Interest cost$4,571 $3,274 
Expected return on plan assets(2,796)(3,374)
Settlement (gain) recognized— — 
Recognized actuarial loss(10,451)57 
Net periodic (benefit) cost$(8,676)$(43)
Estimated amounts that will be amortized from accumulated other comprehensive loss over the next year
Net loss(40)(57)
Information for plan with accumulated benefits in excess of plan assets
Projected benefit obligation$94,989 $100,580 
Accumulated benefit obligation$94,989 $100,580 
Fair value of assets$86,154 $81,547 
U.K. Plan:
The status of the U.K. defined benefit plan is as follows (in thousands):
20232022
Change in benefit obligation
Benefit obligation at beginning of year$33,723 $47,984 
Interest cost1,249 839 
Exchange rate changes1,075 (4,985)
Benefits paid(1,574)(1,750)
Actuarial (gain) loss(6,914)(8,365)
Benefit obligation at end of year$27,559 $33,723 
Weighted average assumptions - benefit obligation
Discount rate5.14 %3.82 %
Rate of compensation increasen/an/a
Change in plan assets
Fair value of plan assets at beginning of year$29,068 $39,344 
Actual return on plan assets(5,940)(5,308)
Employer contributions906 994 
Benefits paid(1,574)(1,750)
Exchange rate changes907 (4,212)
Fair value of plan assets at end of year23,367 29,068 
Funded status at end of year$(4,192)$(4,655)
Amounts recognized in balance sheet
Non current liability(4,192)(4,655)
Net amount recognized in balance sheet(4,192)(4,655)
Weighted average assumptions – net periodic benefit cost
Discount rate3.82 %1.86 %
Rate of compensation increasen/an/a
Return on plan assets4.30 %2.69 %
Amounts not yet reflected in net periodic benefit costs and included in accumulated other comprehensive loss
Accumulated loss$(2,109)$(1,766)
Amounts not yet recognized as a component of net periodic benefit cost(2,109)(1,766)
Accumulated net periodic benefit cost in excess of contributions(2,083)(2,889)
Net amount recognized$(4,192)$(4,655)
Components of net periodic benefit cost
Interest cost1,249 839 
Expected return on plan assets(1,227)(1,004)
Amortization of net loss— — 
Net periodic benefit cost$22 $(165)
Information for plan with accumulated benefits in excess of plan assets
Projected benefit obligation$27,559 $33,723 
Accumulated benefit obligation$27,559 $33,723 
Fair value of assets$23,367 $29,068 
Postretirement Medical and Life Insurance Benefits:
The status of the U.S. postretirement medical and life insurance benefit plan is as follows (in thousands):
20232022
Change in benefit obligation:
Benefit obligation at beginning of year$1,514 $1,890 
Service cost22 36 
Interest cost70 49 
   Plan amendments— — 
Benefits paid(67)(95)
Actuarial (gain) loss(194)(366)
Benefit obligation at end of year$1,345 $1,514 
Weighted average assumptions: benefit obligations
Discount rate5.34 %4.77 %
Rate of compensation increasen/an/a
Change in plan assets
Employer contributions67 95 
Benefits paid, net of employee contributions(67)(95)
Fair value of plan assets at end of year— — 
Amounts recognized in balance sheet
Current postretirement benefit obligation$(104)$(108)
Non-current postretirement benefit obligation(1,241)(1,406)
Net amount recognized in balance sheet$(1,345)$(1,514)
Weighted average assumptions – net periodic benefit cost
Discount rate4.77 %2.69 %
Rate of compensation increasen/an/a
Amounts not yet reflected in net periodic benefit cost and included in accumulated other comprehensive loss
Prior service credit$3,950 $5,424 
Accumulated gain (loss)(810)(1,181)
Amounts not yet recognized as a component of net periodic benefit cost3,140 4,243 
Net periodic benefit cost in excess of accumulated contributions(4,485)(5,757)
Net amount recognized$(1,345)$(1,514)
Components of net periodic benefit cost
Service cost$22 $36 
Interest cost70 49 
Amortization of prior service credit(1,474)(1,474)
Amortization of accumulated loss177 189 
Net periodic benefit $(1,205)$(1,200)
Estimated amounts that will be amortized from accumulated other comprehensive loss over the next year
Prior service credit$(1,474)$(1,474)
Net loss123 177 
$(1,351)$(1,297)
Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A one percentage point change in assumed health care cost trend rates would have the following effects (in thousands):
1% Increase
20232022
Effect on postretirement benefit obligation$1 $1 
1% Decrease
20232022
Effect on postretirement benefit obligation$(1)$(1)
Future pension and other benefit payments are as follows (in thousands):
Fiscal YearPensionOther
Benefits
2024$10,553 $104 
20258,495 104 
20268,579 103 
20278,903 102 
20288,752 102 
After43,653 487 
$88,935 $1,002