Discontinued Operations

3 Months Ended

Mar. 31, 2022

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

On February 1, 2022, the Company completed the sale of the Commercial and Industrial Lighting business to GE Current, a Daintree Company, for total cash consideration of $350 million, subject to customary adjustments with respect to working capital. The sale of this business represents a strategic shift that will have a major effect on our operations and financial results, and as a result, is reported as a discontinued operation in our Condensed Consolidated Financial Statements for all periods presented. The assets and liabilities of this business are also presented as held for sale in the Condensed Consolidated Balance Sheets, in the periods prior to the sale. The Commercial and Industrial Lighting business was previously included in the Electrical Solutions segment.

Under the terms of the transaction, Hubbell and the buyer entered into a transition services agreement ("TSA"), pursuant to which the Company agreed to provide certain administrative and operational services for a period of 12 months or less. Furthermore, we entered into a short-term supply agreement whereby the Company will act as a supplier of finished goods and component parts to the Commercial and industrial Lighting business after the completion of the sale. Income from the TSA and supply agreement was $2.8 million for the quarter ended March 31, 2022 and was recorded in Other Income in the Condensed Consolidated Financial Statements.

The following table presents the summarized components of income from discontinued operations, net of income taxes, for the Commercial and Industrial Lighting business:

	Three Months Ended March 31,
(in millions)	2022		2021
Net sales	$	29.1	$	122.2
Cost of goods sold	27.7		96.0
Gross profit	1.4		26.2
Selling & administrative expenses	10.7		19.9
Operating (loss) income	(9.3)		6.3
Gain on disposal of business	88.5		—
Other income (expense)	0.2		(0.6)
Income from discontinued operations before income taxes	79.4		5.7
Provision for income taxes	1.7		1.3
Income from discontinued operations, net of taxes	$	77.7	$	4.4

Income from discontinued operations, net of taxes for the quarter ended March 31, 2022 includes transaction and separation costs of $2.1 million and a pre-tax gain on the disposal of $88.5 million.

The following table presents the major classes of assets and liabilities classified as held for sale in the Condensed Consolidated Balance Sheet for the year ended December 31, 2021:

(in millions)	December 31, 2021
Cash and cash equivalents	$	0.7
Accounts receivable	83.1
Inventories, net	89.8
Other current assets	5.9
Assets held for sale - current	$	179.5
Property, Plant, and Equipment, net	77.7
Goodwill	50.2
Other intangible assets, net	37.3
Other long-term assets	11.9
Assets held for sale - non-current	$	177.1
Accounts payable	50.2
Accrued salaries, wages and employee benefits	8.5
Accrued insurance	3.9
Other accrued liabilities	28.7
Liabilities held for sale - current	$	91.3
Other Non-Current Liabilities	18.8
Liabilities held for sale - non-current	$	18.8