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Discontinued Operations | 3 Months Ended
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Mar. 31, 2025
Discontinued Operations and Disposal Groups [Abstract] |
Discontinued Operations | Discontinued Operations Sale of Federal and Defense Segment In February 2024, VSE entered into two separate agreements to sell substantially all the Federal and Defense segment's operational assets ("FDS Sale") for a cash consideration of $42.9 million. The FDS Sale is consistent with the Company's long-term strategic growth strategy focused on higher margin and higher growth aftermarket parts distribution and MRO businesses. The Company recorded a pre-tax loss on the FDS Sale of $0.2 million for the three months ended March 31, 2025 related to a settlement of net working capital and a pre-tax loss of $12.7 million and transaction fees of $2.5 million for the three months ended March 31, 2024. All such losses and transaction fees are included in loss from discontinued operations, net of tax in the consolidated statements of operations. Sale of Fleet Segment In February 2025, VSE signed a definitive agreement to sell all issued and outstanding shares of common stock of its Fleet segment. As stated within Note (13) "Subsequent Events", the transaction was completed in April 2025 for a total consideration of up to $230 million (the “Fleet Sale”). This consideration is comprised of a $140 million cash payment at closing, a $25 million seller note, and an earn-out payment of up to $65 million, subject to the achievement of certain milestones. The Company recorded a pre-tax impairment loss on the Fleet assets held-for-sale of $33.7 million during the three months ended March 31, 2025, which is included in loss from discontinued operations, net of tax in the consolidated statements of operations. The components of loss from discontinued operations, net of tax for the three months ended March 31, 2025 and 2024, consist of the following (in thousands):
|  |  |  | Three months ended March 31,
|  |  |  |  |  | 2025 |  | 2024
Revenues |  |  |  |  |  | $ | 75,358 |  |  | $ | 105,425 |
Costs and operating expenses |  |  |  |  |  | 71,829 |  |  | 105,252 |
Income from discontinued operations |  |  |  |  |  | 3,529 |  |  | 173 |
Other impairment |  |  |  |  |  | 33,708 |  |  | 4,204 |
Loss on the sale of discontinued operations |  |  |  |  |  | 244 |  |  | 12,663 |
Total loss before income taxes |  |  |  |  |  | (30,423) |  |  | (16,694) |
Benefit for income taxes |  |  |  |  |  | (7,482) |  |  | (4,541) |
Loss from discontinued operations, net of tax |  |  |  |  |  | $ | (22,941) |  |  | $ | (12,153) |
The assets and liabilities reported as held-for-sale consist of the following (in thousands):
|  |  |  | March 31, |  | December 31,
|  |  | 2025 |  | 2024
Assets |  |  |  |  |
| Cash and cash equivalents |  |  | $ | 4,797 |  |  | $ | (475) |
| Receivables, net |  |  | 47,424 |  |  | 39,459 |
| Inventories |  |  | 141,223 |  |  | 142,259 |
| Prepaid expenses and other current assets |  |  | 10,218 |  |  | 11,057 |
| Property and equipment, net |  |  | 14,113 |  |  | 14,546 |
| Intangible assets, net |  |  | 93 |  |  | 124 |
| Goodwill |  |  | 29,482 |  |  | 63,190 |
| Operating lease right-of-use assets |  |  | 9,595 |  |  | 10,101 |
| Other assets |  |  | 2,566 |  |  | 2,559 |
| Total assets held-for-sale |  |  | $ | 259,511 |  |  | $ | 282,820 |
Liabilities |  |  |  |  |
| Accounts payable |  |  | $ | 36,546 |  |  | $ | 42,099 |
| Accrued expenses and other current liabilities |  |  | 8,402 |  |  | 9,446 |
| Long-term operating lease obligations |  |  | 8,086 |  |  | 8,645 |
| Deferred tax liabilities |  |  | — |  |  | 8,010 |
| Total liabilities held-for-sale |  |  | $ | 53,034 |  |  | $ | 68,200 |
Selected financial information related to cash flows from discontinued operations is as follows (in thousands):
|  | Three months ended March 31, |  |  |
|  | 2025 |  | 2024 |  |  |
Depreciation and amortization |  | $ | 731 |  |  | $ | 835 |  |  |  |
Stock-based compensation (a) |  | $ | (225) |  |  | $ | 222 |  |  |  |
Purchases of property and equipment |  | $ | 208 |  |  | $ | 1,303 |  |  |  |
(a) Stock-based compensation benefit was recognized during the three months ended March 31, 2025 due to forfeitures in the period. |  |  |

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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://fasb.org/us-gaap/role/ref/legacyRef -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/205-20/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 360 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/360/tableOfContent + Details
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