Quarterly report pursuant to Section 13 or 15(d)

Discontinued Operations

v3.3.0.814
Discontinued Operations
9 Months Ended
Sep. 30, 2015
Discontinued Operations [Abstract]  
Discontinued Operations

NOTE 2.  DISCONTINUED OPERATIONS

 

As discussed above, during the year ended December 31, 2014, the Company and Gregory, its then wholly-owned subsidiary, completed the GMP Sale pursuant to the terms of the GMP Purchase Agreement.  The Company received $84,135 in cash for the GMP Sale and paid $2,995 in transaction fees for net proceeds of $81,140.  The Company recognized a pre-tax gain on such sale of $39,491 and tax expense of $19,424.

 

Additionally, as discussed above, on October 7, 2015, the Company sold POC to Dainese and the assets and liabilities of POC are classified as held for sale as of September 30, 2015 and December 31, 2014.  As the POC Disposition was completed during our fourth fiscal quarter of 2015, we expect to recognize a gain on the POC Disposition during the three months ending December 31, 2015.

 

The carrying amounts of the assets and liabilities of POC were classified as held for sale in our condensed consolidated balance sheet.  The asset and liability balances as of September 30, 2015 were classified as current as we anticipated the sale of these assets and liabilities within a one year period.  The carrying amounts were as follows:

 

 

 

 

 

 

 

 

 

 

 

September 30, 2015

 

December 31, 2014

 

 

 

 

 

 

 

Cash

 

$

255 

 

$

1,246 

Accounts receivable

 

 

8,899 

 

 

10,980 

Inventories

 

 

13,685 

 

 

7,692 

Prepaid and other current assets

 

 

1,070 

 

 

837 

Income tax receivable

 

 

 -

 

 

10 

Deferred income taxes

 

 

756 

 

 

483 

Total current assets held for sale

 

 

24,665 

 

 

21,248 

 

 

 

 

 

 

 

Property and equipment, net

 

 

1,525 

 

 

1,525 

Other intangible assets, net

 

 

10,599 

 

 

12,354 

Indefinite lived intangible assets

 

 

11,683 

 

 

12,607 

Goodwill

 

 

11,449 

 

 

12,355 

Deferred income taxes

 

 

127 

 

 

 -

Other long-term assets

 

 

57 

 

 

89 

Total assets held for sale

 

$

60,105 

 

$

60,178 

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$

5,679 

 

$

3,967 

Income tax payable

 

 

237 

 

 

 -

Current portion of long-term debt

 

 

5,841 

 

 

3,875 

Total current liabilities held for sale

 

 

11,757 

 

 

7,842 

 

 

 

 

 

 

 

Long-term debt

 

 

 -

 

 

Deferred income taxes

 

 

4,977 

 

 

5,103 

Total liabilities held for sale

 

$

16,734 

 

$

12,948 

 

 

 

 

 

 

Summarized results of discontinued operations for both GMP and POC are as follows: 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30, 2015

 

September 30, 2014

 

September 30, 2015

 

September 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

10,826 

 

$

12,866 

 

$

24,234 

 

$

42,055 

Cost of goods sold

 

 

(5,278)

 

 

(6,567)

 

 

(12,167)

 

 

(22,853)

Selling, general and administrative

 

 

(3,547)

 

 

(5,000)

 

 

(11,606)

 

 

(16,953)

Transaction costs

 

 

(847)

 

 

(1,680)

 

 

(1,428)

 

 

(2,995)

Interest expense, net

 

 

(33)

 

 

(89)

 

 

(62)

 

 

(781)

Other, net

 

 

29 

 

 

3,201 

 

 

220 

 

 

3,217 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations of discontinued operations

 

 

1,150 

 

 

2,731 

 

 

(809)

 

 

1,690 

Gain on sale of discontinued operations

 

 

 -

 

 

39,491 

 

 

 -

 

 

39,491 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before taxes

 

 

1,150 

 

 

42,222 

 

 

(809)

 

 

41,181 

Income tax expense (benefit)

 

 

43 

 

 

20,657 

 

 

(379)

 

 

20,589 

Income (loss) from discontinued operations, net of tax

 

$

1,107 

 

$

21,565 

 

$

(430)

 

$

20,592 

 

 

 

 

 

 

 

 

 

 

 

 

 

In connection with the GMP Sale, all interest related to outstanding debt that was required to be repaid pursuant to the terms of the Company’s amended and restated loan agreement with Zions First National Bank (the “Lender”) is allocated to discontinued operations in our condensed consolidated financial statements.

 

Summarized condensed cash flow information for both GMP and POC discontinued operations are as follows:

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended

 

 

September 30, 2015

 

September 30, 2014

 

 

 

 

 

 

 

Depreciation of property and equipment

 

 

414 

 

 

440 

Amortization of intangible assets

 

 

852 

 

 

1,430 

Stock-based compensation

 

 

201 

 

 

349 

Purchase of property and equipment

 

 

(578)

 

 

(682)