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Discontinued Operations
 3 Months Ended
Jul. 26, 2014
Discontinued Operations  
Discontinued Operations

Note 3: Discontinued Operations

 

During the fourth quarter of fiscal 2014, we sold substantially all of the assets of our Bauhaus U.S.A. business unit to a group of investors and also classified Lea Industries, a division of La-Z-Boy Greensboro, Inc., as a business held for sale as part of a larger restructuring initiative (see Note 2 for additional information).

 

The operating results of Bauhaus and Lea Industries are reported as discontinued operations for all periods presented.  We had historically reported the results of our Bauhaus business unit as a component of our Upholstery segment and Lea Industries as a component of our Casegoods segment.

 

Also in the first quarter of fiscal 2015, we recorded $3.8 million of income in discontinued operations related to our previously owned subsidiary, American Furniture Company, Incorporated.  We sold this subsidiary in fiscal 2007, and reported it as discontinued operations at that time. The income related to the Continued Dumping and Subsidy Offset Act of 2000, which provides for distribution of duties, collected by U.S. Customs and Border Protection from antidumping cases, to domestic producers that supported the antidumping petition related to wooden bedroom furniture imported from China. When we sold American Furniture Company, Incorporated, our contract provided that we would receive a portion of any such duties to which that entity was entitled.  That entity subsequently filed for bankruptcy.  The funds were distributed by U.S. Customs to the bankruptcy trustee and by the trustee to be held in trust for us during the first quarter of fiscal 2015 and were received by us early in the second quarter.

 

The results of our discontinued operations for the three months ended July 26, 2014, and July 27, 2013, were as follows:

 

 

 

Quarter Ended

 

(Amounts in thousands)

 

7/26/14

 

7/27/13

 

Net sales

 

$
3,487

 

$
13,411

 

 

 

 

 

 

 

Operating income from discontinued operations

 

$
102

 

$
56

 

Income from Continued Dumping and Subsidy Offset Act, net

 
3,763

 

—

 

Income tax expense

 
(1,368

)
(22

)

Income from discontinued operations, net of tax

 

$
2,497

 

$
34

 

 

The assets and liabilities of Lea Industries that were classified as held for sale are as follows:

 

(Amounts in thousands)

 

7/26/14

 

4/26/14

 

Assets

 

 

 

 

 

Receivables, net

 

$
1,115 

 

$
1,190 

 

Inventories, net

 
2,042 

 
3,013 

 

Other current assets

 
31 

 
87 

 

Total assets

 

$
3,188 

 

$
4,290 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

Accounts payable

 

$
289 

 

$
234 

 

Accrued expenses and other current liabilities

 
441 

 
576 

 

Other long-term liabilities

 

—

 
22 

 

Total liabilities

 

$
730 

 

$
832 

 

 

In our consolidated statement of cash flows, the activity of these discontinued operations was included along with our activity from continuing operations.