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NOTE 2—DISCONTINUED OPERATIONS
Canada
In July of 2012, the Company sold 6 of its 8 theatres located in Canada. The operations of these 6 theatres have been eliminated from the Company's ongoing operations during the first quarter of fiscal 2013 and the related assets and liabilities have been classified as held for sale. During the second quarter of fiscal 2013, two theatres with 48 screens were sold under an asset purchase agreement to Empire Theatres Limited and 4 theatres with 86 screens were sold under the share purchase agreement to Cineplex, Inc. The total net proceeds from the sales were approximately $1,421,000, and are subject to working capital and other purchase price adjustments as described in these agreements. The Company does not have any significant continuing involvement in the operations of these 6 theatres after the disposition. The results of operations of these 6 theatres have been classified as discontinued operations, and information presented for all periods reflects the new classification.
Components of amounts reflected as loss from discontinued operations in the Company's Consolidated Statements of Income are presented in the following table:
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks
Ended |
|
|
(In thousands) |
|
June 28,
2012 |
|
June 30,
2011 |
|
|
|
(unaudited)
|
|
|
Revenues |
|
|
|
|
|
|
|
|
Admissions |
|
$ |
10,724 |
|
$ |
12,351 |
|
|
Concessions |
|
|
3,882 |
|
|
4,392 |
|
|
Other revenue |
|
|
316 |
|
|
272 |
|
| |
|
|
|
|
|
|
Total revenues |
|
|
14,922 |
|
|
17,015 |
|
| |
|
|
|
|
|
|
Operating costs and expenses |
|
|
|
|
|
|
|
|
Film exhibition costs |
|
|
5,752 |
|
|
6,616 |
|
|
Concession costs |
|
|
713 |
|
|
721 |
|
|
Operating expense |
|
|
4,995 |
|
|
5,536 |
|
|
Rent |
|
|
4,893 |
|
|
4,726 |
|
|
General and administrative: |
|
|
|
|
|
|
|
|
Other |
|
|
— |
|
|
— |
|
|
Depreciation and amortization |
|
|
193 |
|
|
179 |
|
| |
|
|
|
|
|
|
Operating costs and expenses |
|
|
16,546 |
|
|
17,778 |
|
| |
|
|
|
|
|
|
Operating loss |
|
|
(1,624 |
) |
|
(763 |
) |
|
Other expense (income) |
|
|
|
|
|
|
|
|
Other expense |
|
|
— |
|
|
— |
|
|
Interest expense |
|
|
— |
|
|
— |
|
|
Corporate borrowings |
|
|
— |
|
|
— |
|
|
Capital and financing lease obligations |
|
|
— |
|
|
— |
|
|
Investment income |
|
|
(2 |
) |
|
(2 |
) |
| |
|
|
|
|
|
|
Total other expense |
|
|
(2 |
) |
|
(2 |
) |
| |
|
|
|
|
|
|
Loss before income taxes |
|
|
(1,622 |
) |
|
(761 |
) |
|
Income tax provision |
|
|
— |
|
|
— |
|
| |
|
|
|
|
|
|
Net loss |
|
$ |
(1,622 |
) |
$ |
(761 |
) |
| |
|
|
|
|
|
Cinemex
On December 29, 2008, the Company sold all of its interests in Cinemex, which then operated 44 theatres with 493 screens primarily in the Mexico City Metropolitan Area, to Entretenimiento GM de Mexico S.A. de C.V. ("Entretenimiento"). As of June 28, 2012, the Company estimates that it is contractually entitled to receive an additional $6,208,000 of the purchase price related to tax payments and refunds. While the Company believes it is entitled to these amounts from Cinemex, the collection will require litigation, which was initiated by the Company on April 30, 2010. Resolution could take place over a prolonged period. In fiscal 2010, as a result of the litigation, the Company established an allowance for doubtful accounts related to this receivable and directly charged off the receivable amount as uncollectible. The Company does not have any significant continuing involvement in the operations of the Cinemex theatres after the disposition. The results of operations of the Cinemex theatres have been classified as discontinued operations for all periods presented. Components of amounts reflected as loss from discontinued operations in the Company's Consolidated Statements of Income are presented in the following table:
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks
Ended |
|
|
(In thousands) |
|
June 28,
2012 |
|
June 30,
2011 |
|
|
|
(unaudited)
|
|
|
Operating costs and expenses |
|
|
|
|
|
|
|
|
Loss on disposal of Cinemex |
|
$ |
49 |
|
$ |
9 |
|
| |
|
|
|
|
|
|
Operating costs and expenses |
|
|
49 |
|
|
9 |
|
| |
|
|
|
|
|
|
Operating loss |
|
|
(49 |
) |
|
(9 |
) |
|
Loss before income taxes |
|
|
(49 |
) |
|
(9 |
) |
|
Income tax provision |
|
|
— |
|
|
— |
|
| |
|
|
|
|
|
|
Net loss |
|
$ |
(49 |
) |
$ |
(9 |
) |
| |
|
|
|
|
|
|