Discontinued Operations

12 Months Ended

Dec. 31, 2018

Discontinued Operations Disclosure [Text Block]

6. Discontinued Operations

On January 22, 2018, the Company sold substantially all the assets of its wholly owned subsidiary, Denville, for approximately $20.0 million, which includes a $3.0 million earn-out provision (the Denville Transaction). Upon the closing of the transaction, the Company received $15.7 million. The $3.0 million earn-out provision represents consideration that is contingent on Denville achieving certain performance metrics over a period of two years.

The following table is a reconciliation of the carrying amounts of major assets and liabilities of Denville classified as held for sale in the Company’s consolidated balance sheet as of December 31, 2017.


			December 31,
			2017
		(in thousands)
Carrying amounts of major classes of assets
	Cash	$	541
	Accounts receivable, net		2,854
	Inventories		4,505
	Other receivables and other assets		504
	Current assets held for sale		8,404

	Property, plant and equipment		397
	Amortizable intangible assets		5,930
	Allocation of goodwill		3,633
	Long term assets held for sale		9,960
Total assets of the disposal group classified as held for sale in the consolidated balance sheet		$	18,364

Carrying amounts of major classes of liabilities
	Accounts payable and accrued expenses	$	1,736
	Other current liabilities		121
	Current liabilities held for sale		1,857

	Deferred income tax liabilities		1,311
	Long term liabilities held for sale		1,311
Total liabilities of the disposal group classified as held for sale in the consolidated balance sheet		$	3,168

The following table is a reconciliation of the major line items of income from discontinued operations presented within the Company’s consolidated statements of operations for the years ended December 31, 2018 and 2017.

	Year Ended
	December 31,
	2018			2017
	(in thousands)
Revenues	$	893	$	24,475
Cost of revenues		(534)		(16,048)
Operating and other expenses		(674)		(7,893)
Gain on disposal of discontinued operations		1,251		-
Income from discontinued operations before income taxes	$	936	$	534
Income tax benefit		(441)		(617)
Income from discontinued operations		1,377		1,151

Included within the adjustments to reconcile net loss to net cash provided by operating activities in the Company’s consolidated statements of cash flows for the year ended December 31, 2018 and 2017, was amortization of intangible assets for Denville of $47 thousand and $0.9 million, respectively. Depreciation and capital expenditures for Denville were immaterial for both periods presented.