Discontinued Operations

9 Months Ended

Sep. 30, 2019

Discontinued Operations Disclosure [Text Block]

5. 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 included a $3.0 million earn-out provision (the Denville Transaction). Upon the closing of the transaction, the Company received $15.7 million. The earn-out provision represented contingent consideration of up to $2.0 million based on Denville achieving certain performance metrics with respect to 2018 operating results and up to $1.0 million based on Denville achieving certain performance metrics with respect to 2019 operating results. During the nine-months ended September 30, 2019, it was determined that the 2018 performance metrics were not achieved.

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 nine months ended September 30, 2018.

	Nine Months Ended
	September 30,
	2018
	(in thousands)
Revenues	$	893
Cost of revenues		(534)
Operating and other expenses		(673)
Gain on disposal of discontinued operations		1,251
Income from discontinued operations before income taxes		937
Income tax benefit		(883)
Income from discontinued operations	$	1,820

During the nine months ended September 30, 2019, the Company received a release of an escrow amount of $1.0 million related to the Denville Transaction, which is included in the investing cash flows for disposition in the Company’s consolidated statements of cash flows for the nine months ended September 30, 2019. Total operating cash flows for Denville in the Company’s consolidated statements of cash flows for the nine months ended September 30, 2018, were immaterial.