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Discontinued Operations | 3 Months Ended
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Apr. 01, 2018
Discontinued Operations and Disposal Groups [Abstract] |
Discontinued Operations | Discontinued Operations On February 28, 2018, the Company entered into a Stock Purchase Agreement (the “Purchase Agreement”) to sell the operations of Kratos Public Safety & Security Solutions, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“PSS”), with Securitas Electronic Security, Inc., a Delaware corporation (“Buyer”). Pursuant to the Purchase Agreement, the Company has agreed to sell to Buyer all of the issued and outstanding capital stock of PSS for a purchase price of $69 million in cash, subject to a net working capital adjustment at closing (the “Transaction”). The Company expects to receive approximately $70 million of net cash proceeds from the Transaction, after taking into account amounts to be paid by the Company pursuant to a negotiated transaction services agreement between the Company and Buyer, receipt by the Company of approximately $7 million in net working capital to be retained by the Company, and associated transaction fees and expenses. The Company currently expects the Transaction to close in the second quarter of 2018, following the completion of required regulatory and other related approvals. In accordance with ASC 360-10-45-9, Property, Plant, and Equipment (Topic 360) and ASC 205-20-45-3 Presentation of Financial Statements (Topic 205), PSS and its subsidiaries have been classified as held for sale and reported in discontinued operations in the accompanying condensed consolidated financial statements for all periods presented. The following table presents the results of discontinued operations (in millions):
| April 1, 2018 |  | March 26, 2017
Revenue | $ | 23.9 |  |  | $ | 36.8 |
Cost of sales | 18.9 |  |  | 27.8 |
Selling, general and administrative expenses | 8.1 |  |  | 8.7 |
Other expense | 0.8 |  |  | — |
Income (loss) from discontinued operations before income taxes | (3.9 | ) |  | 0.3 |
Income tax benefit (expense) | 0.4 |  |  | (0.2 | )
Income (loss) from discontinued operations | $ | (3.5 | ) |  | $ | 0.1 |
Revenue and operating results for the three months ended April 1, 2018 were impacted by approximately $1.8 million and $2.0 million, respectively, of cost adjustments on certain security system deployment projects for a mass transit authority. Transaction expenses of $0.8 million primarily comprised of legal fees related to the pending disposition were included in Other expense for the three months ended April 1, 2018. Depreciation expense included in Selling, general and administrative expenses was $0.1 million and $0.1 million for the three months ended April 1, 2018 and March 26, 2017, respectively. The following is a summary of the assets and liabilities of discontinued operations in the accompanying condensed consolidated balance sheets as of April 1, 2018 and December 31, 2017 (in millions):
| April 1, 2018 |  | December 31, 2017
Cash and cash equivalents | $ | (0.7 | ) |  | $ | (0.9 | )
Accounts receivable, net and unbilled receivables, net | 48.6 |  |  | 56.0 |
Inventoried costs | 2.6 |  |  | 1.5 |
Other current assets | 1.6 |  |  | 2.0 |
Current assets of discontinued operations | $ | 52.1 |  |  | $ | 58.6 |
Property, plant and equipment, net | $ | 3.0 |  |  | $ | 3.0 |
Goodwill | 35.6 |  |  | 35.6 |
Other assets | 0.2 |  |  | 0.2 |
Non-current assets of discontinued operations | $ | 38.8 |  |  | $ | 38.8 |
Accounts payable | $ | 9.4 |  |  | $ | 14.2 |
Accrued expenses | 3.4 |  |  | 4.7 |
Accrued compensation | 4.9 |  |  | 4.6 |
Billings in excess of cost and earnings on uncompleted contracts | 4.5 |  |  | 4.3 |
Other current liabilities | 1.0 |  |  | 1.4 |
Current liabilities of discontinued operations | $ | 23.2 |  |  | $ | 29.2 |
Non-current liabilities of discontinued operations | $ | 5.9 |  |  | $ | 6.0 |

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- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
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