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DISCONTINUED OPERATIONS | 6 Months Ended
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Jun. 29, 2025
Discontinued Operations and Disposal Groups [Abstract] |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS On June 14, 2025, the Company entered into an Equity Purchase Agreement (“EPA”) with INSPYR Solutions Intermediate, LLC, (“INSPYR”), pursuant to which the Company will sell to INSPYR substantially all of the outstanding equity interest pertaining to BGSF Professional. Under the EPA, INSPYR will pay $99.0 million in cash at the closing of the transaction and assume certain assets, equity interests, liabilities, and obligations of the Company pertaining to BGSF Professional. The EPA further provides for customary purchase price adjustments, including a net working capital adjustment. The EPA contains customary representations and warranties, covenants (including certain non-competition and non-solicitation covenants restricting the Company with respect to the professional staffing business), closing conditions, and indemnification provisions. The EPA also includes a payment obligation related to the June 10, 2025 letter agreement with Arroyo Consulting, LLC related to the payout of $2.5 million in contingent consideration where by the Company will assume a portion of this obligation to be paid by $1.2 million at closing and $0.6 million in monthly installments. After the closing of the transaction, the Company will provide certain back-office services to INSPYR for a limited period of time. The BGSF Professional financial results for periods prior to the sale have been reflected in our Unaudited Consolidated Balance Sheet, Unaudited Consolidated Statements of Operations, Unaudited Consolidated Statement of Changes in Stockholders’ Equity and Unaudited Consolidated Statements of Cash Flows as discontinued operations. The financial results of BGSF Professional are as follows (in thousands):
|  |  | Thirteen Weeks Ended |  | Twenty-six Weeks Ended
|  |  | June 29, 2025 |  | June 30, 2024 |  | June 29, 2025 |  | June 30, 2024
Revenue |  | $ | 40,268 |  |  | $ | 42,411 |  |  | $ | 82,619 |  |  | $ | 86,630 |
Cost of services |  | 28,024 |  |  | 28,377 |  |  | 57,015 |  |  | 58,501 |
| Gross profit |  | 12,244 |  |  | 14,034 |  |  | 25,604 |  |  | 28,129 |
Selling, general, and administrative expenses |  | 10,000 |  |  | 10,828 |  |  | 19,908 |  |  | 21,582 |
Gain on contingent consideration |  | (450) |  |  | — |  |  | (450) |  |  | — |
Depreciation and amortization |  | 1,336 |  |  | 1,649 |  |  | 2,678 |  |  | 3,317 |
| Income from discontinued operations |  | 1,358 |  |  | 1,557 |  |  | 3,468 |  |  | 3,230 |
Interest (expense) benefit |  | (49) |  |  | 44 |  |  | (91) |  |  | 89 |
| Income from discontinued operations before taxes |  | 1,309 |  |  | 1,601 |  |  | 3,377 |  |  | 3,319 |
Income tax expense |  | (183) |  |  | (280) |  |  | (737) |  |  | (742) |
| Income from discontinued operations, net of income taxes |  | $ | 1,126 |  |  | $ | 1,321 |  |  | $ | 2,640 |  |  | $ | 2,577 |
Carrying amount of assets, liabilities, and equity included as part of discontinued operations (in thousands):

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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 -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/205-20/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 360 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/360/tableOfContent + Details
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