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Equity Earnings of Joint Ventures | 12 Months Ended
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Jul. 02, 2023
Equity Method Investments and Joint Ventures [Abstract] |
Equity Earnings of Joint Ventures | EQUITY EARNINGS OF JOINT VENTURES As discussed above within Investment in Joint Ventures and Majority Owned Subsidiaries, effective June 30, 2023, we sold our one-third ownership interest in VAST LLC, for which we exercised significant influence but did not control. VAST LLC was not a variable interest entity of STRATTEC. Until the effective date of the sale, our investment in VAST LLC was accounted for using the equity method. The results of the VAST LLC foreign subsidiaries and joint venture were reported on a one-month lag basis. During the quarter ended March 27, 2022, VAST China experienced a fire at their Taicang facility. As a result, certain door handle and painting operations were subsequently transferred to their new Jingzhou facility and to another supplier. The transfer of production negatively impacted VAST China’s fiscal 2022 profitability. As a result of the Restructuring Agreement, STRATTEC no longer holds an ownership interest in VAST LLC as of July 2, 2023. The following are summarized statements of operations and summarized balance sheet data for VAST LLC (thousands of dollars):
|  | Years Ended |
|  | July 2, 2023 |  |  | July 3, 2022 |
Net sales |  | $ | 207,362 |  |  | $ | 191,642 |
Cost of goods sold |  |  | 171,851 |  |  |  | 160,886 |
Gross profit |  |  | 35,511 |  |  |  | 30,756 |
Engineering, selling and administrative expense |  |  | 31,302 |  |  |  | 31,887 |
Income (Loss) from operations |  |  | 4,209 |  |  |  | (1,131 | )
Other income, net |  |  | 2,304 |  |  |  | 902 |
Loss on disposal of investment in Brazil |  |  | (1,592 | ) |  |  | — |
Income (Loss) before provision for income taxes |  |  | 4,921 |  |  |  | (229 | )
Provision (benefit) for income taxes |  |  | 672 |  |  |  | (754 | )
Net income |  | $ | 4,249 |  |  | $ | 525 |
STRATTEC’s share of VAST LLC net |  |  |  |  |  |
income |  | $ | 1,416 |  |  | $ | 175 |
Intercompany profit eliminations |  |  | 33 |  |  |  | 2 |
STRATTEC’s equity earnings of VAST LLC prior to loss on sale |  |  | 1,449 |  |  |  | 177 |
Gain on sale of VAST LLC |  |  | 110 |  |  |  | — |
STRATTEC's equity earnings of VAST LLC |  | $ | 1,559 |  |  | $ | 177 |
|  | July 2, 2023 |  |  | July 3, 2022 |
Cash and cash equivalents |  | $ | — |  |  | $ | 21,694 |
Receivables, net |  |  | — |  |  |  | 39,467 |
Inventories, net |  |  | — |  |  |  | 26,881 |
Other current assets |  |  | — |  |  |  | 14,574 |
Total current assets |  |  | — |  |  |  | 102,616 |
Property, plant and equipment, net |  |  | — |  |  |  | 70,096 |
Other long-term assets |  |  | — |  |  |  | 16,686 |
Total assets |  | $ | — |  |  | $ | 189,398 |
Current debt |  | $ | — |  |  | $ | 388 |
Other current liabilities |  |  | — |  |  |  | 86,364 |
Long-term debt |  |  | — |  |  |  | 20,079 |
Other long-term liabilities |  |  | — |  |  |  | 2,258 |
Total liabilities |  | $ | — |  |  | $ | 109,089 |
Net assets |  | $ | — |  |  | $ | 80,309 |
STRATTEC’s share of VAST LLC net assets |  | $ | — |  |  | $ | 26,770 |
We had sales of component parts to VAST LLC, purchases of component parts from VAST LLC, expenses charged to VAST LLC for engineering and accounting services and expenses charged from VAST LLC to STRATTEC for general headquarter expenses. As a result of the Restructuring Agreement, STRATTEC no longer holds an ownership interest in VAST LLC as of July, 2, 2023. The following tables summarize the related party transactions with VAST LLC for the periods indicated (thousands of dollars):
|  | Years Ended |
|  | July 2, 2023 |  |  | July 3, 2022 |
Sales to VAST LLC |  | $ | 64 |  |  | $ | 1,805 |
Purchases from VAST LLC |  | $ | 49 |  |  | $ | 169 |
Expenses charged to VAST LLC |  | $ | 382 |  |  | $ | 593 |
Expenses charged from VAST LLC |  | $ | 761 |  |  | $ | 784 |
|  | July 2, 2023 |  |  | July 3, 2022 |
Accounts receivable from VAST LLC |  | $ | — |  |  | $ | 63 |
Accounts payable to VAST LLC |  | $ | — |  |  | $ | 23 |

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 323 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Subparagraph (a)(3) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481687/323-10-50-3 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 323 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481687/323-10-50-3 Reference 3: http://www.xbrl.org/2003/role/recommendedDisclosureRef -Topic 323 -SubTopic 740 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481543/323-740-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 323 -Publisher FASB -URI https://asc.fasb.org//323/tableOfContent + Details
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