XML 39 R28.htm IDEA: XBRL DOCUMENT v3.23.2
Discontinued Operations
 6 Months Ended
Jul. 01, 2023
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued Operations DISCONTINUED OPERATIONS
The Company has either sold or discontinued certain operations that are accounted for as "Discontinued Operations" under applicable accounting guidance. Discontinued operations are summarized as follows:
Three Months EndedSix Months Ended
 July 1,
2023		June 25,
2022		July 1,
2023		June 25,
2022
Loss from discontinued operations:
Workers' compensation costs from former textile operations$(26)$— $(45)$(1)
Environmental remediation costs from former textile operations(4)10 (29)10 
Commercial business operations(102)(478)(265)(492)
Loss from discontinued operations, before taxes$(132)$(468)$(339)$(483)
Income tax benefit(26)— (26)— 
Loss from discontinued operations, net of tax$(106)$(468)$(313)$(483)

Workers' compensation costs from former textile operations

Undiscounted reserves are maintained for the self-insured workers' compensation obligations related to the Company's former textile operations. These reserves are administered by a third-party workers' compensation service provider under the supervision of Company personnel. Such reserves are reassessed on a quarterly basis. Pre-tax cost incurred for workers' compensation as a component of discontinued operations primarily represents a change in estimate for each period from unanticipated medical costs associated with the Company's obligations.

Environmental remediation costs from former textile operations

Reserves for environmental remediation obligations are established on an undiscounted basis. The Company has an accrual for environmental remediation obligations related to discontinued operations of $2,205 as of July 1, 2023 and $2,205 as of December 31, 2022. The liability established represents the Company's best estimate of possible loss and is the reasonable amount to which there is any meaningful degree of certainty given the periods of estimated remediation and the dollars applicable to such remediation for those periods. The actual timeline to remediate, and thus, the ultimate cost to complete such remediation through these remediation efforts, may differ significantly from the Company's estimates. Pre-tax cost for environmental remediation obligations classified as discontinued operations were primarily a result of specific events requiring action and additional expense in each period.

Commercial business operations

On September 13, 2021, the Company sold assets that included certain inventory, certain items of machinery and equipment used exclusively in the Commercial Business, and related intellectual property. The Company retained the Commercial Business’ cash deposits, all accounts receivable, and certain inventory and equipment. Additionally, the Company agreed not to compete with the specified commercial business and the Atlas|Masland markets for a period of 5 years following September 13, 2021. The Company was allowed to sell the commercial inventory retained by the Company after the divestiture.
At closing, $2,100 of the proceeds were withheld and deposited in escrow to cover any claims arising with respect to the Commercial business for which the Company may be liable. The $2,100 was agreed to be released to the Company (net of claims paid, if any) in two installments with 50% of the escrow paid in 90 days from closing and the remaining amount paid 18 months from the closing date. As of July 1, 2023, the Company has received payment for both installments.

In order to release liens on certain fixed assets included in the Asset Purchase Agreement, the Company placed $2,100 in cash collateral in an account with the lender (Greater Nevada Credit Union). In the first quarter of 2023, the lender released the funds to the Company.

The Company reclassified the following assets and liabilities for discontinued operations in the accompanying consolidated condensed balance sheets:

July 1,
2023		December 31,
2022
Current Assets of Discontinued Operations:
 Receivables, net$163 $385 
 Inventories, net131 255 
 Prepaid expenses— 1 
Current Assets Held for Discontinued Operations$294 $641 
Long Term Assets of Discontinued Operations:
 Property, plant and equipment, net$180 $185 
 Operating lease right of use assets— 63 
 Other assets1,386 1,304 
Long Term Assets Held for Discontinued Operations$1,566 $1,552 
Current Liabilities of Discontinued Operations:
 Accounts payable$126 $127 
 Accrued expenses1,388 2,245 
 Current portion of operating lease liabilities— 75 
Current Liabilities Held for Discontinued Operations$1,514 $2,447 
Long Term Liabilities of Discontinued Operations:
 Other long term liabilities$3,853 $3,759 
Long Term Liabilities Held for Discontinued Operations$3,853 $3,759 

For the three and six months ended July 1, 2023 and June 25, 2022, the Company reclassified the following operations of the Commercial business included in discontinued operations in the accompanying consolidated condensed statements of operations:

Three Months EndedSix Months Ended
July 1,
2023		June 25,
2022		July 1,
2023		June 25,
2022
Net sales$30 $2,480 $170 $7,489 
Cost of sales130 2,788 392 6,895 
Gross profit(100)(308)(222)594 
Selling and administrative expenses3 222 48 1,138 
Other operating income(1)(52)(5)(52)
Loss from discontinued Commercial business operations$(102)$(478)$(265)$(492)