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Discontinued Operations | 9 Months Ended
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Nov. 02, 2013
Discontinued Operations [Abstract] |
Discontinued Operations |
Note 3 | Discontinued Operations
The Company’s discontinued operations included the Avia and Nevados brands of the American Sporting Goods division, as well as the Etienne Aigner and Vera Wang brands. In aggregate, discontinued operations included $1.2 million and $25.5 million of net sales in the thirteen and thirty-nine week periods ended November 2, 2013, respectively. Discontinued operations included $36.2 million and $98.8 million of net sales for the thirteen and thirty-nine week periods ended October 27, 2012, respectively. Discontinued operations included earnings before income taxes of $0.3 million and a loss before income taxes of $10.8 million in the thirteen and thirty-nine week periods ended November 2, 2013, respectively. For the thirty-nine weeks ended November 2, 20 13, discontinued operations also included $11.5 million of costs associated with the Com pany’s impairment of net assets/disposition of discontinued operations. For the thirteen and thirty-nine week periods ended October 27, 2012, discontinued operations included an immaterial amount of earnings before income taxes and a loss before income taxes of $11.5 million, respectively. American Sporting Goods Corporation On May 14, 2013, Brown Shoe International Corp. (“BSIC”), the sole shareholder of American Sporting Goods Corporation, entered into and simultaneously closed a Stock Purchase Agreement (the “Stock Purchase Agreement”) by and among the Company, BSIC and Galaxy Brand Holdings, Inc. (“the Buyer”), pursuant to which the Buyer acquired all of the outstanding capital stock of American Sporting Goods Corporation from BSIC and the Company agreed to provide certain transition services. In connection with the transaction, American Sporting Goods Corporation sold inventory to a third party unaffiliated with the Buyer and distributed certain assets to BSIC. The aggregate purchase price for the stock of American Sporting Goods Corporation and the provision of such transition services was $74.0 million, subject to working capital adjustments, minus the amount of the pre-closing cash dividend declared by American Sporting Goods Corporation and paid to BSIC, representing proceeds from American Sporting Goods Corporation’s sale of inventory. The Company purchased American Sporting Goods Corporation, comprised of Avia, Nevados, Ryka, AND 1, and other businesses, on February 17, 2011 and subsequently sold AND 1 during fiscal 2011. The Avia and Nevados businesses were sold under the Stock Purchase Agreement and t he Company retained and is operating Ryka and other businesses. In this document, “ASG” refers to the subsidiary disposed on May 14, 2013, including the Avia and Nevados brands and excluding the Ryka brand and other retained businesses. The Company received $60.3 million in cash and a promissory note of $12.0 million at closing, from the sale of stock, the sale of inventory, and for the provision of transitional services, less working capital adjustments. The promissory note was due November 14, 2013, earned interest at a 3% annual rate, and was secured by a guarantee by ASG and a lien on certain assets of ASG. In accordance with the terms of the promissory note, the Company received a payment of $12.2 million on November 14, 2013, representing the note principal and accrued interest. As a result of the sale of ASG, the Company recorded an impairment charge in the first quarter of 2013 of $12.6 million ($12.6 million after-tax, $0.30 per diluted share), representing the difference in the fair value less costs to sell as compared to the carrying value of the net assets to be sold. During the second quarter of 2013, the Company recognized a gain upon disposition of the ASG subsidiary of $1.0 million ($1.0 million after tax, $0.02 per diluted share). These charges are reflected in the condensed consolidated statement of earnings as a component of discontinued operations for the thirty-nine weeks ended November 2, 2013. ASG was previously included in the Wholesale Operations segment. Etienne Aigner During the second quarter of 2012, the Company terminated the Etienne Aigner license agreement due to a dispute with the licensor. On April 29, 2013, an agreement to resolve the dispute was reached, pursuant to which the Company agreed to pay Etienne Aigner $6.5 million. The financial results of Etienne Aigner and the $6.5 million settlement are reflected as a component of discontinued operations. The results of Etienne Aigner were previously included in the Wholesale Operations segment. Vera Wang During the first quarter of 2013, the Company communicated its intention not to renew the Vera Wang license agreement. The financial results of Vera Wang are reflected as a component of discontinued operations. The results of Vera Wang were previously included in the Wholesale Operations segment. The detail of ASG, Etienne Aigner, and Vera Wang assets and liabilities reported as discontinued operations in the condensed consolidated balance sheet are as follows:
| November 2, |  | October 27, |  | February 2,
($ thousands) |  | 2013 |  |  | 2012 |  |  | 2013
Discontinued Assets |  |  |  |  |  |  |  |
Current assets |  |  |  |  |  |  |  |
Receivables, net | $ | 73 |  | $ | 25,043 |  | $ | 14,291
Inventories, net |  | 75 |  |  | 27,153 |  |  | 29,587
Prepaid expenses and other current assets |  | 33 |  |  | 4,169 |  |  | 3,231
Total current assets |  | 181 |  |  | 56,365 |  |  | 47,109
Other assets |  | – |  |  | 530 |  |  | 419
Goodwill |  | – |  |  | 25,650 |  |  | 25,650
Intangible assets, net |  | – |  |  | 27,508 |  |  | 27,275
Property and equipment, net |  | – |  |  | 1,066 |  |  | 1,233
Total assets | $ | 181 |  | $ | 111,119 |  | $ | 101,686
Discontinued Liabilities |  |  |  |  |  |  |  |
Current liabilities |  |  |  |  |  |  |  |
Trade accounts payable | $ | 178 |  | $ | 9,566 |  | $ | 9,082
Other accrued expenses |  | 1,932 |  |  | 4,369 |  |  | 4,177
Total current liabilities |  | 2,110 |  |  | 13,935 |  |  | 13,259
Other liabilities |  | – |  |  | 7,203 |  |  | 6,996
Total liabilities | $ | 2,110 |  | $ | 21,138 |  | $ | 20,255

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- Definition The entire disclosure for the facts and circumstances leading to the completed or expected disposal, manner and timing of disposal, the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the segment in which the disposal group was reported, and the classification (whether sold or classified as held for sale) and carrying value of the assets and liabilities comprising the disposal group. Includes all disposal groups, including those classified as components of the entity (discontinued operations). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6391110&loc=d3e2941-110230 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1361-107760 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e957-107759 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1012-107759 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1510-107760 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1020-107759 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 45 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=8077374&loc=d3e2443-110228 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1474-107760 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1436-107760 + Details
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