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DISCONTINUED OPERATIONS | 3 Months Ended
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Mar. 31, 2025
Discontinued Operations and Disposal Groups [Abstract] |
DISCONTINUED OPERATIONS | 11. DISCONTINUED OPERATIONS Flexible Packaging Films On September 1, 2023, the Company entered into an agreement to sell Terphane, headquartered in Brazil, to Oben for net cash-free and debt-free base consideration of $116 million. On November 1, 2024, Tredegar completed the sale of Terphane to Oben. At closing, Tredegar received $60 million in cash, which was net of Terphane debt assumed by Oben of $20 million and estimated Terphane cash retained by Oben of $2 million. The cash proceeds received by Tredegar at closing were after deducting net working capital adjustments and closing indebtedness ($20.5 million), escrow funds ($19.8 million), projected Brazil withholding taxes ($10.8 million), and transaction expenses ($4.4 million). On February 28, 2025, the Company received $9.8 million from post-closing settlement of the transaction. The proceeds from the sale of Terphane were required to be used to pay down debt outstanding under the ABL Facility. Upon completion of the sale, the Company recognized a pre-tax loss of $74.9 million for the year ended December 31, 2024, which included the realization of other comprehensive losses on foreign currency translation adjustments, net of gains on derivative financial instruments of $102.3 million previously reflected in accumulated other comprehensive income (loss). The following table summarizes the financial results of discontinued operations reflected in the Condensed Consolidated Statements of Income (Loss) for the three months ended March 31, 2025 and 2024:
| Three Months Ended March 31, |  |
(In thousands) | 2025 |  | 2024 |  |  |  |
Revenue and other items |  |  |  |  |  |  |
Sales | $ | — |  |  | $ | 31,764 |  |  |  |  |
Other income (expense), net | — |  |  | 2 |  |  |  |  |
| — |  |  | 31,766 |  |  |  |  |
Costs and expenses |  |  |  |  |  |  |
Cost of goods sold | — |  |  | 26,936 |  |  |  |  |
Freight | — |  |  | 1,652 |  |  |  |  |
Selling, general and administrative | 227 |  |  | 1,724 |  |  |  |  |
Research and development | — |  |  | 201 |  |  |  |  |
Amortization of intangibles | — |  |  | 25 |  |  |  |  |
Interest expense 1 | — |  |  | 2,271 |  |  |  |  |
(Gain) loss on sale of business | (9,657) |  |  | — |  |  |  |  |
Total | (9,430) |  |  | 32,809 |  |  |  |  |
Income (loss) from discontinued operations before income tax | 9,430 |  |  | (1,043) |  |  |  |  |
Income tax expense (benefit)2 | — |  |  | (1,727) |  |  |  |  |
Income (loss) from discontinued operations, net of tax | $ | 9,430 |  |  | $ | 684 |  |  |  |  |
1.For the three months ended March 31, 2024, interest expense includes $0.6 million directly related to the $20 million of outstanding Terphane debt assumed by Oben. 2.An inconsequential income tax expense (benefit) was recognized during the three months ended March 31, 2025 primarily due to foreign tax credits generated from the final Brazilian withholding tax payment made during the period, which offset the tax liability on the income from discontinued operations.
Interest expense allocated to discontinued operations was determined by applying the ABL Facility weighted-average interest rate to the Terphane sale proceeds, as the sale proceeds were required to be used to pay down debt outstanding under the ABL Facility. The assets and liabilities of the discontinued operations reflected in the Condensed Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024, respectively were as follows:
(In thousands) | March 31, 2025 |  | December 31, 2024
Assets |  |  |
Deferred income taxes | $ | — |  |  | $ | 126 |
Total noncurrent assets of discontinued operations | $ | — |  |  | $ | 126 |
Liabilities 1 |  |  |
Accounts payable | $ | — |  |  | $ | 161 |
Accrued expenses | — |  |  | 580 |
Total current liabilities of discontinued operations | $ | — |  |  | $ | 741 |
1.The consolidated balance sheet of discontinued operations as of December 31, 2024 includes $0.6 million of severance and $0.2 million of miscellaneous accrued expenses.
The following table provides significant operating, investing and financing cash flow information for discontinued operations:
| Three Months Ended March 31,
(In thousands) | 2025 |  | 2024
Operating activities: |  |  |
Depreciation and amortization | $ | — |  |  | $ | 751 |
Gain (loss) on the sale of divested business | (9,657) |  |  | — |
Total | $ | (9,657) |  |  | $ | 751 |
Investing activities: |  |  |
Proceeds from the sale of Terphane | $ | 9,835 |  |  | $ | — |
Capital expenditures | — |  |  | 517 |
Total | $ | 9,835 |  |  | $ | 517 |

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- Definition The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 855 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/855/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 855 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147483399/855-10-50-2 + Details
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