DISCONTINUED OPERATIONS AND DISPOSALS

6 Months Ended

Jul. 04, 2015

DISCONTINUED OPERATIONS AND DISPOSALS

DISCONTINUED OPERATIONS AND DISPOSALS

3.    DISCONTINUED OPERATIONS AND DISPOSALS

Discontinued Operations

The Company completed the sale of Lucky Brand in February of 2014 and substantially completed the wind-down operations of the Juicy Couture business in the second quarter of 2014.

The Company recorded pretax (charges) income of $(1.5) million and $133.7 million during the six months ended July 4, 2015 and July 5, 2014, respectively, and $(0.8) million and $28.5 million during the three months ended July 4, 2015 and July 5, 2014, respectively, to reflect the estimated difference between the carrying value of the net assets disposed and their estimated fair value, less costs to dispose, including transaction costs.

Summarized results of discontinued operations are as follows:

	Six Months Ended						Three Months Ended
	July 4, 2015 (26 Weeks)			July 5, 2014 (27 Weeks)			July 4, 2015 (13 Weeks)			July 5, 2014 (13 Weeks)
In thousands
Net sales	$	187		$	208,658		$	(21	)	$	58,073
(Loss) income before provision for income taxes	$	(788	)	$	(38,943	)	$	78		$	(18,903	)
Provision for income taxes	59			643			5			5
(Loss) income from discontinued operations, net of income taxes	$	(847	)	$	(39,586	)	$	73		$	(18,908	)
(Loss) gain on disposal of discontinued operations, net of income taxes	$	(1,523	)	$	133,743		$	(781	)	$	28,487

The Company recorded charges of $0.6 million and $25.1 million during the six months ended July 4, 2015 and July 5, 2014, respectively, and $0.3 million and $12.9 million during the three months ended July 4, 2015 and July 5, 2014, respectively, related to its streamlining initiatives within Discontinued operations, net of income taxes.

Other

As discussed in Note 1 – Basis of Presentation, the Company completed substantially all of the closures of its KATE SPADE SATURDAY operations and JACK SPADE retail stores in the second quarter of 2015. Although such dispositions are individually significant, they do not represent a strategic shift in the Company’s operations and are not reflected as discontinued operations. The Company recorded pretax losses of $17.6 million and $14.2 million during the six months ended July 4, 2015 and July 5, 2014, respectively, and $1.8 million and $7.4 million during the three months ended July 4, 2015 and July 5, 2014, respectively, related to the KATE SPADE SATURDAY business and JACK SPADE retail stores that were substantially disposed in the second quarter of 2015.