Quarterly report pursuant to Section 13 or 15(d)

Discontinued Operations & Other Divestiture Charges Discontinued Operations & Divestiture Activities (Details)

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Discontinued Operations & Other Divestiture Charges Discontinued Operations & Divestiture Activities (Details) - USD ($)
$ in Thousands
3 Months Ended 6 Months Ended
Dec. 02, 2019
Oct. 31, 2019
Oct. 22, 2019
Sep. 20, 2019
Feb. 28, 2021
May 31, 2020
Feb. 29, 2020
Feb. 28, 2021
Feb. 29, 2020
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                  
Proceeds from sale of business/product line               $ 0 $ 8,726
Impairment & divestiture (benefits) charges         $ 401   $ (768) 539 (2,124)
Net (Loss) Earnings from Discontinued Operations         (402)   (1,756) $ (626) (6,007)
Impairment & Divestiture Benefit             800   800
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]              
Note 5. Discontinued Operations and Other Divestiture Activities
Discontinued Operations
On October 31, 2019, as part of our overall strategy to become a pure-play industrial tools and services company, the Company completed the sale of the businesses comprising its former Engineered Components & Systems ("EC&S") segment to wholly owned subsidiaries of BRWS Parent LLC, a Delaware limited liability company and affiliate of One Rock Capital Partners II, LP, for a sales price of $215.8 million, inclusive of $1.3 million of purchase price from the customary finalization of working capital negotiations in the third quarter of fiscal 2020. Approximately $3.0 million of the purchase price was paid in four equal quarterly installments after closing, of which the last $0.7 million was received in the six months ended February 28, 2021 (this final payment was received greater than one year from the divestiture date and, as such, is reflected in "Cash provided by financing activities - discontinued operations" within the Condensed Consolidated Statements of Cash Flows). In connection with the completion of the sale and after consideration of working capital adjustments, the Company recorded, in fiscal 2020, a net loss of $4.7 million, comprised of a loss of $23.0 million representing the excess of the net assets (exclusive of deferred tax assets and liabilities associated with subsidiaries of the Company whose stock was sold as part of the transaction) as compared to the purchase price less costs to sell and the recognition in earnings of the cumulative effect of foreign currency exchange gains and losses during the year, largely offset by an income tax benefit of $18.3 million associated with the write off of the net deferred tax liability on subsidiaries of the EC&S segment for which the stock was divested. The Company also recognized in conjunction with the completion of the sale an additional $3.3 million of impairment & divestiture costs associated with the accelerated vesting of restricted stock awards for employees terminated as part of the transaction and $2.7 million of additional divestiture charges which were necessary to complete the transaction. The Company maintains financial exposure associated with this divestiture due to certain retained liabilities.
As the aforementioned divestiture was a part of our strategic shift to become a pure-play industrial tools and services company, the results of their operations (including the stated impairment & divestiture charges) are recorded as a component of "Loss from discontinued operations" in the Condensed Consolidated Statements of Operations for all periods presented.
The following represents the detail of "Loss from discontinued operations, net of income taxes" within the Condensed Consolidated Statements of Operations (in thousands):
Three Months Ended Six Months Ended
February 28, 2021 February 29, 2020 February 28, 2021 February 29, 2020 *
Net sales $ —  $ —  $ —  $ 67,010 
Cost of products sold —  —  —  49,749 
Gross profit —  —  —  17,261 
Selling, general and administrative expenses 559  619  854  11,451 
Amortization of intangible assets —  —  —  — 
Restructuring benefit —  —  —  (11)
Impairment & divestiture charges —  314  —  28,730 
Operating loss (559) (933) (854) (22,909)
Financing costs, net —  —  —  14 
Other loss, net —  —  —  (104)
Loss before income tax (benefit) expense (559) (933) (854) (22,819)
Income tax (benefit) expense (157) 823  (228) (16,812)
Loss from discontinued operations, net of income taxes $ (402) $ (1,756) $ (626) $ (6,007)
* "Loss from discontinued operations, net of income taxes" for the six-month period in fiscal 2020 presented in the table above includes the results of the EC&S segment for the two months ended October 31, 2019 (the divestiture date) as well as the ancillary impacts from certain retained liabilities subsequent to the divestiture. As a result of the classification of the segment as assets and liabilities held for sale for the two months ended October 31, 2019, the Company did not record amortization or depreciation expense in the results of operations in accordance with U.S. GAAP. Furthermore, the Company excluded EC&S segment employees from the fiscal 2020 bonus compensation plan, hence there are no expenses associated with the plan for that period.
Other Divestiture Activities
On September 20, 2019, the Company completed the sale of the UNI-LIFT product line, a component of our Milwaukee Cylinder business (IT&S segment) for initial net cash proceeds of $6.0 million, which resulted in an impairment & divestiture benefit of $4.6 million in the three months ended November 30, 2019. In the three months ended February 29, 2020, the Company recorded
an additional benefit of $0.1 million related to agreement with the buyer on final working capital amounts and various other benefits. In March 2020, the buyer of the UNI-LIFT product line extended a long-term supply agreement with a significant customer. Pursuant to the divestiture agreement, this action triggered the requirement for the buyer to pay $1.5 million of contingent proceeds, which was received by the Company in the three months ended May 31, 2020 and recorded as an "Impairment & divestiture benefit" within the Condensed Consolidated Statements of Operations in that period.
After the sale of the UNI-LIFT product line, the Company determined that the remaining Milwaukee Cylinder business was a non-core asset, did not align with the strategic objectives of the Company and, as a result, the Company committed to a plan to sell this business. The Company recorded impairment & divestiture charges of $4.6 million in the three months ended November 30, 2019, comprised of impairment charges of $2.5 million representing the excess of net assets held for sale compared to the anticipated proceeds less costs to sell, $1.9 million associated with our withdrawal from the multi-employer pension plan associated with that business and $0.2 million of other divestiture related charges. The Company completed the divestiture of the Milwaukee Cylinder business on December 2, 2019 for a negligible amount. In the three months ended February 29, 2020, the Company recorded inconsequential amounts of impairment & divestiture charges associated with this divestiture.
The historical results of the Milwaukee Cylinder business, inclusive of the UNI-LIFT product line, (which had net sales of $2.9 million in the six months ended February 29, 2020) are not material to the condensed consolidated financial results.
On October 22, 2019, the Company completed the sale of the Connectors product line (IT&S segment) for net cash proceeds of $2.7 million, which resulted in an impairment & divestiture benefit of $1.3 million in the three months ended November 30, 2019. During the three months ended February 29, 2020, the Company recorded $0.1 million of impairment & divestiture charges related to a working capital adjustment. The historical results of the Connectors product line (which had net sales of $0.2 million in the six months ended February 29, 2020) are not material to the condensed consolidated financial results.
At February 29, 2020, the Company determined that it was no longer probable that a loss will occur related to an outstanding legal matter associated with a previously divested business, as such, recorded an impairment & divestiture benefit of $0.8 million in the three and six months ended February 29, 2020.
 
Engineered Components & Systems [Member]                  
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                  
Disposal Date   Oct. 31, 2019              
Quarterly Installment Payments   $ 3,000           $ 700  
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax   (4,700)              
Impairment & divestiture (benefits) charges   3,300              
Other Divestiture Charges   2,700              
Working Capital Negotiations Adjustments           $ 1,300      
Disposal Group, Including Discontinued Operation, Costs of Goods Sold         0   0 0 49,749
Disposal Group, Including Discontinued Operation, Revenue         0   0 0 67,010
Disposal Group, Including Discontinued Operation, Gross Profit (Loss)         0   0 0 17,261
Disposal Group, Including Discontinued Operation, General and Administrative Expense         559   619 854 11,451
Disposal Group, Including Discontinued Operation, Amortization of Intangible Assets         0   0 0 0
Disposal Group, Including Discontinued Operation, Restructuring (Benefit) Charges         0   0 0 (11)
Disposal Group, Including Discontinued Operation, Impairment & Divestiture (Benefits) Charges         0   314 0 28,730
Disposal Group, Including Discontinued Operation, Operating Income (Loss)         (559)   (933) (854) (22,909)
Disposal Group, Including Discontinued Operation, Financing Costs (Benefits)         0   0 0 14
Disposal Group, Including Discontinued Operation, Other Expense (Income), net         0   0 0 (104)
Disposal Group, Including Discontinued Operation, (Loss) Earnings Before Income Tax Benefit         (559)   (933) (854) (22,819)
Disposal Group, Including Discontinued Operation, Income Tax (Benefit) Expense         (157)   823 (228) (16,812)
Net (Loss) Earnings from Discontinued Operations         $ (402)   (1,756) $ (626) (6,007)
UNI-LIFT Product Line [Domain]                  
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                  
Impairment & divestiture charges (benefit)             100    
Disposal Date       Sep. 20, 2019          
Proceeds from sale of business/product line       $ 6,000          
Impairment & divestiture (benefits) charges             4,600    
Contingent Proceeds       $ 1,500          
Milwaukee Cylinder (excluding UNI-LIFT) [Member]                  
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                  
Disposal Date Dec. 02, 2019                
Impairment & divestiture (benefits) charges                 4,600
Other Divestiture Charges                 200
Goodwill, Impairment Loss                 2,500
Charges Associated with Withdrawl of Pension Plan                 1,900
Milwaukee Cylinder (including UNI-LIFT) [Member]                  
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                  
Disposal Group, Not Discontinued Operation, annual revenue                 2,900
Connectors Product Line [Member]                  
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                  
Disposal Date     Oct. 22, 2019            
Proceeds from sale of business/product line     $ 2,700            
Impairment & divestiture (benefits) charges             $ (100)   1,300
Disposal Group, Not Discontinued Operation, annual revenue                 $ 200
Engineered Components & Systems [Member] [Domain]                  
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                  
Proceeds from sale of business/product line   215,800              
Asset Impairment Charges   23,000              
Income Tax Benefit Related to the Write Off of Net Deferred Tax Liability   $ 18,300