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Discontinued Operations Discontinued Operations Income statement (Tables)
 9 Months Ended
Sep. 30, 2017
Disposal Groups, Including Discontinued Operations [Table Text Block]
The following table summarizes the operating results of the Company’s discontinued operations related to the sale described above for the three and nine months ended September 30, 2017 and 2016, as presented in “Income (loss) from discontinued operations, net of tax” on the Unaudited Condensed Consolidated Statements of Income (in thousands):
 
Three Months Ended
 
Nine Months Ended
 
September 30, (1)
 
September 30,
 
2016
 
2017
 
2016
Revenue
$
179,487

 
$
111,130

 
$
325,374

Cost of goods sold
151,519

 
100,084

 
281,275

Operating expenses
8,371

 
8,369

 
13,763

    Operating income
19,597

 
2,677

 
30,336

Interest and other (expense) income, net (2)
(29
)
 
1,204

 
(3,562
)
    Income from discontinued operations before provision for income taxes
19,568

 
3,881

 
26,774

Provision for income taxes (3)
6,962

 
3,598

 
9,526

Equity in earnings (loss) of unconsolidated subsidiaries
238

 
(534
)
 
571

    Income (loss) from discontinued operations, net of tax
12,844

 
(251
)
 
17,819

Loss on sale of discontinued operations, net of tax (4)
—

 
(4,280
)
 
—

     Net income (loss) from discontinued operations, net of tax
$
12,844

 
$
(4,531
)
 
$
17,819

(1)
There were no discontinued operations for the three months ended September 30, 2017 as the glass manufacturing business was sold on March 1, 2017.
(2)
The Company elected to allocate interest expense to discontinued operations based on the expected debt to be repaid. Under this approach, allocated interest from January 1, 2017 through the date of sale was $2 million and from April 21, 2016 to September 30, 2016 was $4 million. The allocated interest from July 1, 2016 to September 30, 2016 was $2 million. The other expenses, net were foreign currency gains and losses.
(3)
The provision for income taxes for 2017 includes a return to provision adjustment related to international operations of the glass manufacturing business.
(4)
In the first quarter of 2017, upon closing of the sale and write-off of the net assets of the glass manufacturing business, we recorded a pre-tax loss on sale of $9 million, and a $4 million tax benefit. The incremental loss primarily reflects a $6 million payable for intercompany sales from the glass manufacturing business to the aftermarket automotive glass distribution business incurred prior to closing which was paid by LKQ during the second quarter of 2017 and capital expenditures in 2017 that were not reimbursed by the buyer. No adjustments to the loss on sale were recorded in the third quarter of 2017.