Discontinued Operations

12 Months Ended

Dec. 31, 2021

Discontinued Operations and Disposal Groups [Abstract]


20.			Discontinued Operations

During the fourth quarter of 2019, we entered into an agreement to sell the Fairbanks Morse division, which comprised our entire Power Systems segment. The sale of Fairbanks Morse to an affiliate of funds managed by private equity firm Arcline Investment Management closed on January 21, 2020 for a sales price of $450.0 million. The pre-tax gain on the disposition of Fairbanks Morse was $274.3 million. We have reported, for all periods presented, the results of operations and cash flows of Fairbanks Morse as discontinued operations in the accompanying financial statements.

For 2020 and 2019, results of operations from Fairbanks Morse were as follows:


	Years Ended December 31,
	2020		2019
	(in millions)
Net sales	$	7.6	$	284.2
Cost of sales	7.6		216.9
Gross profit	—		67.3
Operating expenses:
Selling, general, and administrative expenses	1.5		28.2
Other	(0.1)		0.8
Total operating expenses	1.4		29.0
Income (loss) from discontinued operations before income taxes	(1.4)		38.3
Income tax benefit (expense)	0.3		(7.8)
Income (loss) from discontinued operations, net of taxes before gain from sale of discontinued operations	(1.1)		30.5
Gain from sale of discontinued operations, net of taxes	209.2		—
Income from discontinued operations, net of taxes	$	208.1	$	30.5

Pursuant to applicable accounting guidance for the reporting of discontinued operations, allocations to Fairbanks Morse for corporate services have not been reflected in the above financial statements of discontinued operations and were included as part of our income from continuing operations in the accompanying consolidated financial statements of the company for all periods as they are expected to be in the future. As a result, income before income taxes of Fairbanks Morse has been increased by $2.4 million in 2019 with an offsetting increase in corporate expenses.