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Dispositions and Special Charges | 6 Months Ended
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Jun. 30, 2018
Discontinued Operations and Disposal Groups [Abstract] |
Dispositions and Special Charges | Dispositions and Special Charges The Company’s discontinued operations include the results of the SARL Businesses sold in March 2017 and the NATG business sold in December 2015 (See Note 1). In the second quarter of 2018 the Company recorded net recoveries of $0.1 million in discontinued operations related to the wind down of the SARL Businesses. The Company received escrow funds of approximately $0.2 million and recorded approximately $0.1 million of accelerated depreciation on fixed assets. For the six months ended June 30, 2018, the Company recorded $0.2 million in recoveries of escrow funds, $0.1 million of accelerated depreciation charges and $0.1 million for legal and professional fees. The impact of the previously mentioned charges and recoveries related to the wind down of the SARL Businesses for the six months ended June 30, 2018, net to zero. Of the previously mentioned charges, legal and professional fees required or will require the use of cash. The Company expects that total additional charges related to the wind down of the SARL businesses will be less than $1.0 million. In the second quarter of 2018, the Company's NATG discontinued operations received $0.1 million in vendor settlements, recorded $0.1 million in lease reserve adjustments related to their leased facilities and recorded approximately $0.1 million of legal and professional fees related to the ongoing restitution proceedings. For the six months ended June 30, 2018, the Company's NATG discontinued operations received $0.7 million in restitution receipts from a former executive of NATG, reversed lease reserves of approximately $0.1 million related to their leased facilities, received $0.1 million in vendor settlements and recorded legal and professional fees, related to the ongoing restitution proceedings, of $0.2 million. The impact of the previously mentioned charges and recoveries related to the NATG discontinued operations totaled $0.7 million benefit for the six months ended June 30, 2018. The Company expects that total additional charges related to the sale of the NATG business after this quarter will be between $1.0 million and $2.0 million and that these charges will continue to be presented in discontinued operations. Additional costs may be incurred in NATG for outstanding leased facilities as they are settled or sublet (see Note 1). Most of these anticipated costs will require the use of cash. Amounts that are unpaid at June 30, 2018 are recorded in Accrued expenses and other current liabilities and Other liabilities (long term) in the accompanying Condensed Consolidated Balance Sheets. Below is a summary of the impact on net sales, net income (loss) and net income (loss) per share from discontinued operations for the three and six month periods ended June 30, 2018 and 2017. A reconciliation of pretax income (loss) of Discontinued operations to the Net Income (loss) of discontinued operations is as follows (in millions):
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2018 |  | 2017 |  | 2018 |  | 2017
Net sales | $ | 0.0 |  |  | $ | 0.0 |  |  | $ | 0.0 |  |  | $ | 117.0 |
Cost of sales | 0.0 |  |  | 0.0 |  |  | 0.0 |  |  | 102.9 |
Gross profit | 0.0 |  |  | 0.0 |  |  | 0.0 |  |  | 14.1 |
Selling, distribution & administrative expenses | (0.4 | ) |  | 1.4 |  |  | 0.0 |  |  | 20.0 |
Special charges | 0.0 |  |  | 4.4 |  |  | (0.7 | ) |  | 28.3 |
Operating income (loss) from discontinued operations | 0.4 |  |  | (5.8 | ) |  | 0.7 |  |  | (34.2 | )
Interest and other (income) expenses, net | (0.1 | ) |  | 0.2 |  |  | (0.3 | ) |  | 0.5 |
Income (loss) from discontinued operations before income taxes | 0.5 |  |  | (6.0 | ) |  | 1.0 |  |  | (34.7 | )
Provision (benefit) for income taxes | 0.1 |  |  | (0.5 | ) |  | 0.2 |  |  | (0.4 | )
Net income (loss) from discontinued operations | $ | 0.4 |  |  | $ | (5.5 | ) |  | $ | 0.8 |  |  | $ | (34.3 | )
Net income (loss) per share – basic | $ | 0.01 |  |  | $ | (0.15 | ) |  | $ | 0.02 |  |  | $ | (0.93 | )
Net income (loss) per share – diluted | $ | 0.01 |  |  | $ | (0.15 | ) |  | $ | 0.02 |  |  | $ | (0.92 | )
Total special charges incurred in the second quarter of 2017 totaled approximately $4.4 million, of which $0.9 million related to additional costs related to the sale of the SARL Businesses including $0.3 million of severance and other personnel costs, $0.3 million of accelerated depreciation charges and $0.3 million of additional legal, professional and other costs. Additional special charges, incurred in the second quarter of 2017, within NATG discontinued operations totaled $3.5 million. These costs were primarily related to updating future lease cash flows of approximately $3.2 million and $0.3 million of professional costs related to the ongoing restitution proceedings against certain former NATG executives. Total special charges incurred for the six months ended June 30, 2017 totaled approximately $28.3 million. The combined loss on the sale of the SARL Businesses totaled $24.2 million, which included an $8.2 million loss on the sale of net assets, $14.4 million of translation adjustments, and $1.0 million of legal, professional and other costs, $0.3 million of severance and other personnel costs and $0.3 million of accelerated depreciation charges. In addition, NATG discontinued operations incurred special charges of $4.1 million, which included approximately $3.5 million primarily related to updating our future lease cash flows and $0.6 million related to the ongoing restitution proceedings against certain former NATG executives. The following table details liabilities related to the sold NATG segment’s leases and other costs and liabilities that remain from the sold Misco Germany business as of June 30, 2018 (in millions):
|  | ETG – Lease liabilities and other costs |  | NATG – Lease liabilities and other exit costs |  | Total
Balance January 1, 2018 |  | $ | 1.2 |  |  | $ | 19.0 |  |  | $ | 20.2 |
Charged to expense (income) |  | 0.0 |  |  | (0.1 | ) |  | (0.1 | )
Paid or otherwise settled |  | (0.1) |  |  | (5.9 | ) |  | (6.0 | )
Balance June 30, 2018 |  | $ | 1.1 |  |  | $ | 13.0 |  |  | $ | 14.1 |
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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 -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
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